<PAGE>
________________________________________________________________________________
________________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
______________________
FORM 10-Q
( X ) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1999.
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM __________ TO __________
COMMISSION FILE NUMBER: 0-21643
______________________________
CV THERAPEUTICS, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 43-1570294
(State of Incorporation) (I.R.S. Employer Identification No.)
3172 PORTER DRIVE, PALO ALTO, CALIFORNIA 94304
(Address of principal executive offices, including zip code)
Registrant's telephone number, including area code: (650) 812-0585
Indicate by check whether the Registrant (1) has filed all reports to be
filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
The number of shares of Common Stock, $0.001 par value, outstanding as of
April 30, 1999 was 11,248,255.
________________________________________________________________________________
________________________________________________________________________________
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CV THERAPEUTICS, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)
(unaudited)
<TABLE>
<CAPTION>
March 31, December 31,
1999 1998
--------- ---------
(unaudited) (1)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 7,068 $ 11,954
Marketable securities 32,358 32,850
Other current assets 1,048 1,236
--------- ---------
Total current assets 40,474 46,040
Notes receivable from related parties 450 450
Property and equipment, net 2,767 2,664
Intangible and other assets 144 176
--------- ---------
Total Assets $ 43,835 $ 49,330
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 1,030 $ 1,001
Accrued liabilities 2,581 2,761
Current portion of long-term debt 1,000 1,500
Current portion of capital lease obligation 82 80
--------- ---------
Total current liabilities 4,693 5,342
Long-term debt 7,500 7,500
Capital lease obligation 316 338
Deferred revenue 1,000 1,000
Other liabilities 369 412
--------- ---------
Total liabilities 13,878 14,592
Commitments
Stockholders' equity:
Preferred stock, $0.001 par value, 5,000,000 shares authorized, none
issued and outstanding - -
Common stock, $0.001 par value, 30,000,000 shares authorized, 11,246,044
and 11,209,078 shares issued and outstanding at March 31, 1999 and
December 31, 1998, respectively; at amounts paid in 104,316 104,211
Warrants to purchase common stock 1,225 1,225
Notes receivable issued for stock (87) (108)
Deferred compensation (876) (1,049)
Accumulated deficit (74,606) (69,553)
Cumulative other comprehensive income (15) 12
--------- ---------
Total stockholders' equity 29,957 34,738
--------- ---------
Total Liabilities and Stockholders' Equity $ 43,835 $ 49,330
========= =========
</TABLE>
(1) Derived from the audited financial statements included in the Company's
Annual Report on Form 10-K for 1998
See accompanying notes
<PAGE>
CV THERAPEUTICS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
<TABLE>
<CAPTION>
Three months ended March 31,
-------------------------
1999 1998
--------- ---------
<S> <C> <C>
Revenues:
Collaborative research $ - $ 4,183
Operating expenses:
Research and development 4,199 3,336
General and administrative 1,184 1,008
--------- ---------
Total operating expenses 5,383 4,344
--------- ---------
Loss from operations (5,383) (161)
Interest income 575 717
Interest and other expense (245) (611)
--------- ---------
Net loss $ (5,053) $ (55)
========= =========
Basic and diluted net loss per share $ (0.45) $ (0.01)
========= =========
Shares used in computing basic and diluted
net loss per share 11,232 10,221
========= =========
</TABLE>
See accompanying notes
<PAGE>
CV THERAPEUTICS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
<TABLE>
<CAPTION>
Three months ended March 31,
-------------------------
1999 1998
--------- ---------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (5,053) $ (55)
Adjustments to reconcile net loss to net cash used in
operating activities:
Amortization of deferred compensation 170 163
Depreciation and amortization 382 257
Change in assets and liabilities:
Other current assets 188 (128)
Intangible and other assets 32 347
Accounts payable 29 (278)
Accrued and other liabilities (223) 38
Deferred revenue - (4,108)
--------- ---------
Net cash used in operating activities (4,475) (3,764)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of investments (5,643) (13,860)
Maturities of investments 6,000 6,000
Capital expenditures (377) (107)
Notes receivable from officers and employees 21 -
--------- ---------
Net cash used in investing activities 1 (7,967)
CASH FLOWS FROM FINANCING ACTIVITIES
Payments on capital lease obligations (20) (1,232)
Repayments of long-term debt (500) -
Net proceeds from issuance of common stock, net of repurchases 108 19,717
--------- ---------
Net cash provided by financing activities (412) 18,485
--------- ---------
Net increase (decrease) in cash and cash equivalents (4,886) 6,754
Cash and cash equivalents at beginning of period 11,954 6,286
--------- ---------
Cash and cash equivalents at end of period $ 7,068 $ 13,040
========= =========
</TABLE>
See accompanying notes
<PAGE>
CV THERAPEUTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying consolidated financial statements of CV Therapeutics,
Inc. have been prepared in accordance with generally accepted accounting
principles, are unaudited and reflect all adjustments (consisting solely of
normal recurring adjustments) which are, in the opinion of management,
necessary to present fairly the financial position at, and the results of
operations for, the interim periods presented. The results of operations
for the three-month period ended March 31, 1999 are not necessarily
indicative of the results to be expected for the entire year ending December
31, 1999 or future operating results. The financial information included
herein should be read in conjunction with the Company's Annual Report on
Form 10-K which includes the audited consolidated financial statements and
the notes thereto for the year ended December 31, 1998.
Revenue Recognition
Revenue under the Company's collaborative research arrangements is
recognized based on the performance requirements of the contract. Payments
received, which are still subject to future performance requirements, are
recorded as deferred revenue until earned.
Net Loss Per Share
Net loss per share is computed using the weighted average number of
common shares outstanding. Common equivalent shares have been excluded from
the computation as their effect is antidilutive.
2. COMPREHENSIVE LOSS
The components of comprehensive loss for the three months ended March 31,
1999 and 1998 are as follows:
<TABLE>
<CAPTION>
1999 1998
--------- ---------
<S> <C> <C>
(in thousands)
Net loss $ (5,053) $ (55)
Unrealized losses on marketable securities (27) (26)
--------- ---------
Comprehensive loss $ (5,080) $ (81)
========= =========
</TABLE>
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
This Management's Discussion and Analysis of Financial Condition and
Results of Operations and other parts of this Quarterly Report on Form 10-Q
contain forward-looking statements which involve risks and uncertainties.
The Company's actual results may differ materially from the results
discussed in the forward-looking statements. Factors that might cause such a
difference include, but are not limited to, those listed below and those
listed in "Risk Factors" in the Company's Annual Report on Form 10-K for the
year ended December 31, 1998.
OVERVIEW
CVT is an early stage biopharmaceutical company focused on the
application of molecular cardiology to the discovery, development and
commercialization of novel small molecule drugs for the treatment of
cardiovascular disease. Since its inception in December 1990, substantially
all of the Company's resources have been dedicated to research and
development. To date, CVT has not generated any product revenue and does not
expect to generate any such revenues for at least several years. As of March
31, 1999, the Company had an accumulated deficit of $74.6 million. The
Company expects its sources of revenue, if any, for the next several years
to consist of payments under corporate partnerships and interest income. The
process of developing the Company's products will require significant
additional research and development, preclinical testing and clinical
trials, as well as regulatory approval. These activities, together with the
Company's general and administrative expenses, are expected to result in
operating losses for the foreseeable future. The Company will not receive
product revenue unless it or its collaborative partners complete clinical
trials and successfully commercialize one or more of its products.
CVT is subject to risks common to biopharmaceutical companies, including
risks inherent in its research and development efforts and clinical trials,
reliance on collaborative partners, enforcement of patent and proprietary
rights, the need for future capital, potential competition and uncertainty
of regulatory approval. In order for a product to be commercialized, it will
be necessary for CVT and, in some cases, its collaborators, to conduct
preclinical tests and clinical trials, demonstrate efficacy and safety of
the Company's product candidates, obtain regulatory clearances and enter
into manufacturing, distribution and marketing arrangements, as well as
obtain market acceptance. There can be no assurance that the Company will
generate revenues or achieve and sustain profitability in the future.
RESULTS OF OPERATIONS
Collaborative Research Revenues. There were no collaborative research
revenues for the quarter ended March 31, 1999, compared to $4.2 million for
the quarter ended March 31, 1998. The collaborative research revenue for the
quarter ended March 31, 1998 was the result of the Company's completion of
the research component of its collaboration with Biogen during the first
quarter of 1998.
Research and Development Expenses. The Company's research and
development expenses increased to $4.2 million for the quarter ended March
31, 1999, compared to $3.3 million for the quarter ended March 31, 1998. The
increase for the quarter ended March 31, 1999, compared to the same period
in 1998, was primarily due to hiring additional employees to provide support
for an increased level of activity in the research, development and clinical
programs. The Company expects research and development expenses to continue
to increase over the next several years as the Company further expands
product development efforts and clinical trials.
General and Administrative Expenses. General and administrative expenses
were $1.2 million for the quarter ended March 31, 1999, compared to $1.0
million for the quarter ended March 31, 1998. The increase for the quarter
ended March 31, 1999, compared to the same period in 1998, was primarily due
to an increase in outside legal expenses for a variety of administrative and
corporate issues. The Company expects general and administrative expenses to
increase in the future in line with the Company's research and development
activities.
Interest Income/Interest and Other Expense. Interest income was $575,000
for the quarter ended March 31, 1999, compared to $717,000 for the quarter
ended March 31, 1998. The decrease for the quarter ended March 31, 1999,
compared to the same period in 1998, was due to lower average investment
balances. Interest and other expense was $245,000 for the quarter ended
March 31, 1999 compared to $611,000 for the quarter ended March 31, 1998.
<PAGE>
The decrease for the quarter ended March 31, 1999, compared to the same
period in 1998, was due to a charge of $371,000 recognized during the first
quarter of 1998 related to the early retirement of a capital lease
obligation. The Company expects that interest income/interest and other
expense will fluctuate with average investment and loan balances.
LIQUIDITY AND CAPITAL RESOURCES
The Company has financed its operations since inception primarily through
private placements of preferred and common stock, public offerings of common
stock, equipment and leasehold improvement financing, other debt financing
and payments under corporate collaborations. In November 1996, the Company
completed an initial public offering and raised net proceeds of
approximately $12.0 million. In March 1997, the Company entered into two
research collaboration and license agreements with Biogen that together
resulted in cash receipts of $16.0 million. In October 1997, the Company
raised net proceeds of $12.3 million in a private placement of equity
securities with BB Biotech. In January 1998, the Company completed a
follow-on public offering and raised net proceeds of approximately $19.6
million. In September 1998, the Company arranged equipment financing in the
amount of $443,000 resulting in the establishment of a new capital lease. As
of March 31, 1999 the outstanding balance for this capital lease was
$398,000. In December 1998, the Company drew down an additional $4.5 million
under a general purpose loan facility with Biogen. As of March 31, 1999 the
outstanding balance for this note was $7,500,000. Interest on this note is
at prime plus one percent (1%) (8.75% at March 31, 1999) payable annually,
in arrears, each March 10th.
Cash, cash equivalents and marketable securities at March 31, 1999
totaled $39.4 million compared to $44.8 million at December 31, 1998. The
decrease in the first three months of 1999 was due to the funding of ongoing
operations.
Net cash used in operations for the quarter ended March 31, 1999 was $4.5
million compared to $3.8 million for the quarter ended March 31, 1998. The
increase in cash used in operations for the first three months of 1999,
compared to the first three months of 1998, was due to increased research
and development efforts.
As of March 31, 1999, the Company has invested $7.7 million in property
and equipment with the rate of investment having increased last year in line
with increased research and development efforts. This trend should continue
for the foreseeable future.
The Company will require substantial additional funding in order to
complete its research and development activities and commercialize any
potential products. The Company currently estimates that its existing
resources and projected interest income will enable the Company to maintain
its current and planned operations through the first half of 2000. However,
there can be no assurance that the Company will not require additional
funding prior to such time or that additional financing will be available on
acceptable terms or at all.
The Company's forecast of the period of time through which its financial
resources will be adequate to support its operations is a forward-looking
statement that involves risks and uncertainties, and actual results could
vary as a result of a number of factors. The Company's future capital
requirements will depend on many factors, including scientific progress in
its research and development programs, the size and complexity of such
programs, the scope and results of preclinical studies and clinical trials,
the ability of the Company to establish and maintain corporate partnerships,
the time and costs involved in obtaining regulatory approvals, the costs
involved in filing, prosecuting and enforcing patent claims, competing
technological and market developments, the cost of manufacturing
preclinical and clinical material and other factors not within the Company's
control. There can be no assurance that such additional financing to meet
the Company's capital requirements will be available on acceptable terms or
at all. Insufficient funds may require the Company to delay, scale back or
eliminate some or all of its research or development programs, to lose
rights under existing licenses or to relinquish greater or all rights to
product candidates at an earlier stage of development or on less favorable
terms than the Company would otherwise choose or may adversely affect the
Company's ability to operate as a going concern. If additional funds are
raised by issuing equity securities, substantial dilution to existing
stockholders may result.
<PAGE>
YEAR 2000
Many computer systems, applications, information technologies and
equipment containing computer related components (generally "computer
systems and equipment") are unable to differentiate between the year 2000
and the year 1900 because they were programmed with two-digit, rather than
four-digit, date fields. Accordingly, older computer systems that have
time-sensitive applications may not properly recognize the year 2000 and
beyond ("Year 2000 issue"). This could cause system or equipment shut downs,
failures or miscalculations resulting in inaccuracies in computer output or
disruptions of operations, including, among other things, inaccurate
processing of financial information and/or temporary inabilities to process
transactions, manufacture products, or engage in similar normal business
activities.
The Company has formed a committee to assess the impact of the problem on
the Company's operations; however, the committee's assessment of the Year
2000 issue is not yet complete. The Company has tested its key computer
systems and equipment (including financial, informational and operational
systems) and determined that these systems are largely Year 2000 compliant.
The Company expects to complete upgrades to its systems which are not Year
2000 compliant by the end of 1999. The Company believes that with these
upgrades, the Year 2000 issue will not pose significant operational problems
for its computer systems and equipment. However, if such upgrades are not
made or are not completed in a timely fashion, the Year 2000 issue might
have an adverse impact on the operations of the Company, the precise degree
of which cannot be known at this time. The Company currently has no
contingency plans to deal with major Year 2000 failures.
In addition to risks associated with the Company's own computer systems
and equipment, the Company has relationships with, and is to varying degrees
dependent upon, a large number of third parties that provide information,
goods and services to the Company. These include financial institutions,
suppliers, vendors, research partners and governmental entities. If
significant numbers of these third parties experience failures in their
computer systems, or equipment due to the Year 2000 issue, these failures
could affect the Company's ability to process transactions, manufacture
products, or engage in similar normal business activities. While some of
these risks are outside of the Company's control, the Company has instituted
programs, including internal records review and use of external
questionnaires, to identify key third parties, assess their level of Year
2000 compliance, update contracts and address any non-compliance issues.
The total cost of the Year 2000 systems assessment and upgrades is funded
through operating cash flows and the Company is expensing these costs. The
Company has created a mechanism to trace certain of the costs related to the
Year 2000 issue and budgeted funds to address the issues of assessment
conversion. The financial impact of making the required systems changes
cannot be known precisely at this time, but it is currently expected to be
less than $100,000. The actual financial impact could, however, exceed this
estimate. These costs are not expected to be material to the Company's
financial position, results of operations or cash flows.
ADDITIONAL FACTORS THAT MAY AFFECT FUTURE RESULTS
The Company's business, financial condition and results of operations are
subject to various risks, including those described below and elsewhere in
this Quarterly Report on Form 10-Q.
The Company is an early stage company and must be evaluated in light of
the uncertainties and complications present in an early stage
biopharmaceutical company. All of the Company's products are at an early
stage of development, and the Company has not generated any product revenue.
In addition, the Company has only three products in clinical development,
ranolazine (phase III), CVT-124 (phase II) and CVT-510 (phase I). There can
be no assurance that clinical trials conducted by the Company or its
collaborators will demonstrate sufficient safety and efficacy to obtain the
requisite approvals or that marketable products will result. In addition,
the rate of completion of clinical trials may be delayed by many factors.
The Company's product candidates will require significant additional
development, preclinical studies, clinical trials and regulatory approval
prior to commercialization. These activities may take several years and
require the expenditure of substantial resources. In addition, these
activities, together with the Company's general and administrative expense,
are expected to result in operation losses for the foreseeable future.
<PAGE>
The Company's strategy for the research, development and
commercialization of its product candidates has required, and will continue
to require, the Company to enter into various arrangements with corporate
and academic collaborators, licensors, licensees and others, and the Company
is dependent upon the success of these parties in performing their
responsibilities. There can be no assurance that the Company will be able
to enter into additional collaborative arrangements or license agreements on
acceptable terms, or at all, or that the contemplated benefits from any of
these agreements will be realized.
The Company's business is affected by other factors, including:
uncertainty of market acceptance, intense competition and rapid
technological change, uncertainty of patent position and proprietary rights,
dependence on key personnel and the need to attract and retain key employees
and consultants, limited manufacturing, marketing and sales experience,
significant government regulation, uncertainty of product pricing and
reimbursement, product liability exposure and the availability of insurance.
<PAGE>
PART II. OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
On January 4, 1998 the Company filed a registration statement with the
Securities and Exchange Commission for a follow-on public offering. The
follow-on public offering closed on January 27, 1998 and the Company
received net proceeds of approximately $19,624,000. As of March 31, 1999,
the Company has used all of the net proceeds from the follow-on public
offering for temporary investments, including cash equivalents and
marketable securities.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits required by Item 601 of Regulation S-K
EXHIBIT NUMBER DESCRIPTION
10.57 Executive Severance Benefits Agreement
between Registrant and Louis G. Lange,
M.D., Ph.D., dated February 2, 1999.
10.58 Executive Severance Benefits Agreement
between Registrant and Daniel K.
Spiegelman, dated February 2, 1999.
10.59 Executive Severance Benefits Agreement
between Registrant and Andrew A. Wolff,
M.D., dated February 2, 1999.
10.60 Executive Severance Benefits Agreement
between Registrant and Cynthia L. Clark,
Esq., dated February 2, 1999.
10.61 Executive Severance Benefits Agreement
between Registrant and Brent K.
Blackburn, Ph.D., dated February 2, 1999.
10.62 Executive Severance Benefits Agreement
between Registrant and Richard M. Lawn,
Ph.D., dated February 2, 1999.
10.63 Executive Severance Benefits Agreement
between Registrant and Luiz
Belardinelli, M.D., dated February 2, 1999.
10.64 Executive Severance Benefits Agreement
between Registrant and Stephen J. Grana,
dated February 2, 1999.
27.1 Financial Data Schedule
(b) Reports on Form 8-K
The Company filed a current report on Form 8-K with the Commission
on February 5, 1999, with respect to the adoption of a Rights Plan.
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf, by the undersigned, thereunto duly authorized.
CV THERAPEUTICS, INC.
Date: May 12, 1999 By: /s/ LOUIS G.LANGE, M.D., PH.D.
Louis G. Lange, M.D., Ph.D.
Chairman of the Board & Chief Executive Officer
(Principal Executive Officer)
Date: May 12, 1999 By: /s/ DANIEL K. SPIEGELMAN
Daniel K. Spiegelman
Chief Financial Officer
(Principal Financial and Accounting Officer)
<PAGE>
EXECUTIVE
SEVERANCE BENEFITS AGREEMENT
This EXECUTIVE SEVERANCE BENEFITS AGREEMENT (the "AGREEMENT")
is entered into this 2nd day of February, 1999 (the "Effective
Date"), between LOUIS G. LANGE ("EXECUTIVE") and CV Therapeutics,
Inc. (the "COMPANY"). This Agreement is intended to provide
Executive with the compensation and benefits described herein upon
the occurrence of specific events. Certain capitalized terms used
in this Agreement are defined in Article 5.
The Company and Executive hereby agree as follows:
ARTICLE 1
SCOPE OF AND CONSIDERATION FOR THIS AGREEMENT
1.1 Executive is currently employed by the Company.
1.2 The Company and Executive wish to set forth the
compensation and benefits which Executive shall be entitled to
receive in the event Executive's employment with the Company is
terminated under the circumstances described herein following a
Change in Control.
1.3 The duties and obligations of the Company to Executive
under this Agreement shall be in consideration for Executive's past
services to the Company, Executive's continued employment with the
Company, and Executive's execution of a release in accordance with
Section 3.1.
1.4 This Agreement shall supersede any other agreement
relating to cash severance benefits and health benefits in the event
of Executive's severance from employment with the Company following
a Change in Control.
ARTICLE 2
SEVERANCE BENEFITS
2.1 SEVERANCE BENEFITS. If Executive's employment terminates
due to an Involuntary Termination Without Cause or a Constructive
Termination within thirteen (13) months following the effective date
of a Change in Control, such termination of employment will be
deemed a Covered Termination. A Covered Termination entitles
Executive to receive the following benefits set forth in Sections
2.2, 2.3, 2.4, and 2.5.
2.2 SALARY CONTINUATION. Executive shall continue to receive
Base Salary for eighteen (18) months following a Covered
Termination. Such amount shall be paid in regular installments on
the normal payroll dates of the Company and shall be subject to all
required tax withholding.
<PAGE>
2.3 BONUS. The Company shall pay to Executive an amount
equal to one hundred and fifty percent (150%) of the annual bonus
paid to the Executive in the year immediately preceding the
effective date of the Change in Control. Such amount shall be paid
in regular installments on the normal payroll dates of the Company
and shall be subject to all required tax withholding.
2.4 HEALTH BENEFITS. Provided that Executive elects
continued coverage under federal COBRA law, the Company shall pay
the premiums of Executive's group health insurance coverage,
including coverage for Executive's eligible dependents, for a
maximum period of eighteen (18) months following a Covered
Termination; provided, however, that the Company shall pay premiums
for Executive's eligible dependents only for coverage for which
those eligible dependents were enrolled immediately prior to the
Covered Termination. No premium payments will be made following the
effective date of Executive's coverage by a health insurance plan of
a subsequent employer. For the balance of the period that Executive
is entitled to coverage under federal COBRA law, Executive shall be
entitled to maintain such coverage at Executive's own expense.
2.5 OPTION ACCELERATION. If Executive's employment with the
Company terminates due to a Covered Termination, then all options of
Executive to purchase the Company's common stock (or the stock of a
successor to the Company by reason of assumption or substitution of
options) shall become immediately fully vested and exercisable as of
the date of Executive's termination of employment.
2.6 MITIGATION. Except as otherwise specifically provided
herein, Executive shall not be required to mitigate damages or the
amount of any payment provided under this Agreement by seeking other
employment or otherwise, nor shall the amount of any payment
provided for under this Agreement be reduced by any compensation
earned by Executive as a result of employment by another employer or
by any retirement benefits received by Executive after the date of
the Covered Termination.
ARTICLE 3
LIMITATIONS AND CONDITIONS ON BENEFITS
3.1 RELEASE PRIOR TO PAYMENT OF BENEFITS. Upon the
occurrence of a Covered Termination, and prior to the payment of any
benefits under this Agreement on account of such Covered
Termination, Executive shall execute a release (the "Release") in
the form attached hereto and incorporated herein as Exhibit A or
Exhibit B, as applicable. Such Release shall specifically relate to
all of Executive's rights and claims in existence at the time of
such execution and shall confirm Executive's obligations under the
Company's standard form of proprietary information and inventions
agreement. It is understood that, as specified in the applicable
Release, Executive has a certain number of calendar days to consider
whether to execute such Release, and Executive may revoke such
Release within seven (7) calendar days after execution. In the
event Executive does not execute such Release within the applicable
period, or if Executive revokes such Release within the subsequent
seven (7) day period, no benefits shall be payable under this
Agreement, and this Agreement shall be null and void.
<PAGE>
3.2 TERMINATION OF BENEFITS. Benefits under this Agreement
shall terminate immediately if the Executive, at any time, violates
any proprietary information or confidentiality obligation to the
Company.
3.3 NON-DUPLICATION OF BENEFITS. Executive is not eligible
to receive benefits under this Agreement more than one time.
ARTICLE 4
PARACHUTE PAYMENTS
PARACHUTE PAYMENTS. If any payment or benefit Executive would
receive under this Plan, when combined with any other payment or
benefit Executive receives pursuant to the termination of
Executive's employment with the Company ("Payment"), would (i)
constitute a "parachute payment" within the meaning of Section 280G
of the Internal Revenue Code of 1986, as amended (the "Code"), and
(ii) but for this sentence, be subject to the excise tax imposed by
Section 4999 of the Code (the "Excise Tax"), then such Payment shall
be either (x) the full amount of such Payment or (y) such lesser
amount (with cash payments being reduced before stock option
compensation) as would result in no portion of the Payment being
subject to the Excise Tax, whichever of the foregoing amounts,
taking into account the applicable federal, state and local
employment taxes, income taxes, and the Excise Tax results in
Executive's receipt, on an after-tax basis, of the greater amount of
the Payment notwithstanding that all or some portion of the Payment
may be subject to the Excise Tax.
ARTICLE 5
DEFINITIONS
For purposes of the Agreement, the following terms are defined
as follows:
5.1 "BASE SALARY" means Executive's annual base salary as in
effect during the last regularly scheduled payroll period
immediately preceding the Covered Termination.
5.2 "BOARD" means the Board of Directors of the Company.
5.3 "CAUSE" means that, in the reasonable determination of
the Company or, in the case of the Chief Executive Officer, the
Board, Executive:
(A) has committed an act that materially injures the business
of the Company;
(B) has refused or failed to follow lawful and reasonable
directions of the Board or the appropriate individual to whom
Executive reports;
(C) has willfully or habitually neglected Executive's duties
for the Company; or
(D) has been convicted of a felony involving moral turpitude
that is likely to inflict or has inflicted material injury on the
business of the Company.
<PAGE>
Notwithstanding the foregoing, Cause shall not exist based on
conduct described in clause (b) or clause (c) unless the conduct
described in such clause has not been cured within fifteen (15) days
following Executive's receipt of written notice from the Company or
the Board, as the case may be, specifying the particulars of the
conduct constituting Cause.
5.4 "CHANGE IN CONTROL" means
(A) a sale of substantially all of the assets of the Company;
(B) a merger or consolidation in which the Company is not the
surviving corporation (other than a merger or consolidation in which
shareholders immediately before the merger or consolidation have,
immediately after the merger or consolidation, equal or greater
stock voting power);
(C) a reverse merger in which the Company is the surviving
corporation but the shares of the Company's common stock outstanding
immediately preceding the merger are converted by virtue of the
merger into other property, whether in the form of securities, cash
or otherwise (other than a reverse merger in which shareholders
immediately before the merger have, immediately after the merger,
greater stock voting power); or
(D) any transaction or series of related transactions in
which in excess of 50% of the Company's voting power is transferred.
5.5 "COMPANY" means CV Therapeutics, Inc. or, following a
Change in Control, the surviving entity resulting from such
transaction.
5.6 "CONSTRUCTIVE TERMINATION" means that Executive
voluntarily terminates employment within thirteen (13) months
following a Change in Control after any of the following are
undertaken without Executive's express written consent:
(A) the assignment to Executive of any duties or
responsibilities which results in a significant diminution in
Executive's function as in effect immediately prior to the effective
date of the Change in Control; provided, however, that a mere change
in Executive's title or reporting relationships shall not constitute
a Constructive Termination;
(B) a reduction by the Company in Executive's annual base
salary, as in effect on the effective date of the Change in Control
or as increased thereafter;
(C) any failure by the Company to continue in effect any
benefit plan or program, including fringe benefits, incentive plans
and plans with respect to the receipt of securities of the Company,
in which Executive is participating immediately prior to the
effective date of the Change in Control (hereinafter referred to as
"Benefit Plans"); or the taking of any action by the Company that
would adversely affect Executive's participation in or reduce
Executive's benefits under the Benefit Plans; provided, however,
that a "Constructive Termination" shall not exist under this
paragraph following a Change in Control if the Company offers a
range of benefit plans and programs which, taken as a whole, are
comparable to the Benefit Plans;
<PAGE>
(D) a relocation of Executive's business office to a location
more than twenty (20) miles from the location at which Executive
performs duties as of the effective date of the Change in Control,
except for required travel by Executive on the Company's business to
an extent substantially consistent with Executive's business travel
obligations prior to the Change in Control; provided, however, that
if Executive performs sales functions for the Company, a change of
sales territory shall not constitute a basis for Constructive
Termination so long as the Executive's business office is not
relocated as provided above;
(E) a material breach by the Company of any provision of this
Agreement; or
(F) any failure by the Company to obtain the assumption of
this Agreement by any successor or assign of the Company.
5.7 "COVERED TERMINATION" means an Involuntary Termination
Without Cause or a Constructive Termination occurring within
thirteen (13) months following the effective date of a Change in
Control.
5.8 "INVOLUNTARY TERMINATION WITHOUT CAUSE" means Executive's
dismissal or discharge other than for Cause. The termination of
Executive's employment as a result of Executive's death or
disability will not be deemed to be an Involuntary Termination
Without Cause.
ARTICLE 6
GENERAL PROVISIONS
6.1 EMPLOYMENT STATUS. This Agreement does not constitute a
contract of employment or impose upon Executive any obligation to
remain as an employee, or impose on the Company any obligation (i)
to retain Executive as an employee, (ii) to change the status of
Executive as an at-will employee, or (iii) to change the Company's
policies regarding termination of employment.
6.2 NOTICES. Any notices provided hereunder must be in
writing, and such notices or any other written communication shall
be deemed effective upon the earlier of personal delivery (including
personal delivery by facsimile) or the third day after mailing by
first class mail, to the Company at its primary office location and
to Executive at Executive's address as listed in the Company's
payroll records. Any payments made by the Company to Executive
under the terms of this Agreement shall be delivered to Executive
either in person or at the address as listed in the Company's
payroll records.
6.3 SEVERABILITY. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement
is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability will not affect any other provision
or any other jurisdiction, but this Agreement will be reformed,
construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provisions had never been contained herein.
<PAGE>
6.4 WAIVER. If either party should waive any breach of any
provisions of this Agreement, he or it shall not thereby be deemed
to have waived any preceding or succeeding breach of the same or any
other provision of this Agreement.
6.5 ARBITRATION. Unless otherwise prohibited by law or
specified below, all disputes, claims and causes of action, in law
or equity, arising from or relating to this Agreement or its
enforcement, performance, breach, or interpretation shall be
resolved solely and exclusively by final and binding arbitration
held in San Francisco County, California through Judicial
Arbitration & Mediation Services/Endispute ("JAMS") under the then
existing JAMS arbitration rules. However, nothing in this section
is intended to prevent either party from obtaining injunctive relief
in court to prevent irreparable harm pending the conclusion of any
such arbitration. Each party in any such arbitration shall be
responsible for its own attorneys' fees, costs and necessary
disbursement; provided, however, that in the event one party refuses
to arbitrate and the other party seeks to compel arbitration by
court order, if such other party prevails, it shall be entitled to
recover reasonable attorneys' fees, costs and necessary
disbursements. Pursuant to California Civil Code Section 1717, each
party warrants that it was represented by counsel in the negotiation
and execution of this Agreement, including the attorneys' fees
provision herein.
6.6 COMPLETE AGREEMENT. This Agreement, including Exhibit A
and Exhibit B, constitutes the entire agreement between Executive
and the Company and is the complete, final, and exclusive embodiment
of their agreement with regard to this subject matter, wholly
superseding all written and oral agreements with respect to cash
severance benefits and health benefits to Executive in the event of
employment termination other than any outstanding loans by the
Company to Executive. It is entered into without reliance on any
promise or representation other than those expressly contained herein.
6.7 AMENDMENT OR TERMINATION OF AGREEMENT. This Agreement
may be changed or terminated only upon the mutual written consent of
the Company and Executive. The written consent of the Company to a
change or termination of this Agreement must be signed by an
executive officer of the Company after such change or termination
has been approved by the Board.
6.8 COUNTERPARTS. This Agreement may be executed in separate
counterparts, any one of which need not contain signatures of more
than one party, but all of which taken together will constitute one
and the same Agreement.
6.9 HEADINGS. The headings of the Articles and Sections
hereof are inserted for convenience only and shall not be deemed to
constitute a part hereof nor to affect the meaning thereof.
6.10 SUCCESSORS AND ASSIGNS. This Agreement is intended to
bind and inure to the benefit of and be enforceable by Executive,
and the Company, and any surviving entity resulting from a Change in
Control and upon any other person who is a successor by merger,
acquisition, consolidation or otherwise to the business formerly
carried on by the Company, and their respective successors, assigns,
heirs, executors and administrators, without regard to whether or
not such person actively assumes any rights or duties hereunder;
<PAGE>
provided, however, that Executive may not assign any duties
hereunder and may not assign any rights hereunder without the
written consent of the Company, which consent shall not be withheld
unreasonably.
6.11 CHOICE OF LAW. All questions concerning the
construction, validity and interpretation of this Agreement will be
governed by the law of the State of California, without regard to
such state's conflict of laws rules.
6.12 NON-PUBLICATION. The parties mutually agree not to
disclose publicly the terms of this Agreement except to the extent
that disclosure is mandated by applicable law or to respective
advisors (e.g., attorneys, accountants).
6.13 CONSTRUCTION OF AGREEMENT. In the event of a conflict
between the text of the Agreement and any summary, description or
other information regarding the Agreement, the text of the Agreement
shall control.
IN WITNESS WHEREOF, the parties have executed this Agreement on
the Effective Date written above.
CV THERAPEUTICS, INC. LOUIS G. LANGE
By: /s/ COSTA G. SEVASTOPOULOS, PH.D. /s/ LOUIS G. LANGE
Name: Costa G. Sevastopoulos, Ph.D.
Title: Director
Exhibit A: Release (Individual Termination)
Exhibit B: Release (Group Termination)
<PAGE>
EXHIBIT A
RELEASE
(INDIVIDUAL TERMINATION)
Certain capitalized terms used in this Release are defined in
the Executive Severance Benefits Agreement (the "Agreement") which I
have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.
I acknowledge that I have read and understand Section 1542 of
the California Civil Code which reads as follows: "A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT
WITH THE DEBTOR." I hereby expressly waive and relinquish all
rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any
claims I may have against the Company.
Except as otherwise set forth in this Release, I hereby
release, acquit and forever discharge the Company, its parents and
subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and
from any and all claims, liabilities, demands, causes of action,
costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise,
known and unknown, suspected and unsuspected, disclosed and
undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment
with the Company), arising out of or in any way related to
agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such
claims and demands directly or indirectly arising out of or in any
way connected with my employment with the Company or the termination
of that employment, including but not limited to, claims of
intentional and negligent infliction of emotional distress, any and
all tort claims for personal injury, claims or demands related to
salary, bonuses, commissions, stock, stock options, or any other
ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance pay, or any other form of disputed
compensation; claims pursuant to any federal, state or local law or
cause of action including, but not limited to, the federal Civil
Rights Act of 1964, as amended; the federal Age Discrimination in
Employment Act of 1967, as amended ("ADEA"); the federal Employee
Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; the California Fair
Employment and Housing Act, as amended; tort law; contract law;
statutory law; common law; wrongful discharge; discrimination;
fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that
nothing in this paragraph shall be construed in any way to release
the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or
applicable law.
<PAGE>
I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under ADEA. I also acknowledge that
the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything
of value to which I was already entitled. I further acknowledge
that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or
claims that may arise on or after the date I execute this Release;
(B) I have the right to consult with an attorney prior to executing
this Release; (C) I have twenty-one (21) days to consider this
Release (although I may choose to voluntarily execute this Release
earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; and (E) this Release
shall not be effective until the date upon which the revocation
period has expired, which shall be the eighth day after this Release
is executed by me.
LOUIS G. LANGE
Date:
<PAGE>
EXHIBIT B
RELEASE
(GROUP TERMINATION)
Certain capitalized terms used in this Release are defined in
the Executive Severance Benefits Agreement (the "Agreement") which I
have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.
I acknowledge that I have read and understand Section 1542 of
the California Civil Code which reads as follows: "A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT
WITH THE DEBTOR." I hereby expressly waive and relinquish all
rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any
claims I may have against the Company.
Except as otherwise set forth in this Release, I hereby
release, acquit and forever discharge the Company, its parents and
subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and
from any and all claims, liabilities, demands, causes of action,
costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise,
known and unknown, suspected and unsuspected, disclosed and
undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment
with the Company), arising out of or in any way related to
agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such
claims and demands directly or indirectly arising out of or in any
way connected with my employment with the Company or the termination
of that employment, including but not limited to, claims of
intentional and negligent infliction of emotional distress, any and
all tort claims for personal injury, claims or demands related to
salary, bonuses, commissions, stock, stock options, or any other
ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance pay, or any other form of disputed
compensation; claims pursuant to any federal, state or local law or
cause of action including, but not limited to, the federal Civil
Rights Act of 1964, as amended; the federal Age Discrimination in
Employment Act of 1967, as amended ("ADEA"); the federal Employee
Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; the California Fair
Employment and Housing Act, as amended; tort law; contract law;
statutory law; common law; wrongful discharge; discrimination;
fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that
nothing in this paragraph shall be construed in any way to release
the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or
applicable law.
<PAGE>
I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under ADEA. I also acknowledge that
the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything
of value to which I was already entitled. I further acknowledge
that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or
claims that may arise on or after the date I execute this Release;
(B) I have the right to consult with an attorney prior to executing
this Release; (C) I have forty-five (45) days to consider this
Release (although I may choose to voluntarily execute this Release
earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; (E) this Release shall
not be effective until the date upon which the revocation period has
expired, which shall be the eighth day after this Release is
executed by me; and (F) I have received with this Release a
detailed list of the job titles and ages of all employees who were
terminated in this group termination and the ages of all employees
of the Company in the same job classification or organizational unit
who were not terminated.
LOUIS G. LANGE
Date:
<PAGE>
EXECUTIVE
SEVERANCE BENEFITS AGREEMENT
This EXECUTIVE SEVERANCE BENEFITS AGREEMENT (the "AGREEMENT")
is entered into this 2nd day of February, 1999 (the "Effective
Date"), between DANIEL K. SPIEGELMAN ("EXECUTIVE") and CV Therapeutics,
Inc. (the "COMPANY"). This Agreement is intended to provide
Executive with the compensation and benefits described herein upon
the occurrence of specific events. Certain capitalized terms used
in this Agreement are defined in Article 5.
The Company and Executive hereby agree as follows:
ARTICLE 1
SCOPE OF AND CONSIDERATION FOR THIS AGREEMENT
1.1 Executive is currently employed by the Company.
1.2 The Company and Executive wish to set forth the
compensation and benefits which Executive shall be entitled to
receive in the event Executive's employment with the Company is
terminated under the circumstances described herein following a
Change in Control.
1.3 The duties and obligations of the Company to Executive
under this Agreement shall be in consideration for Executive's past
services to the Company, Executive's continued employment with the
Company, and Executive's execution of a release in accordance with
Section 3.1.
1.4 This Agreement shall supersede any other agreement
relating to cash severance benefits and health benefits in the event
of Executive's severance from employment with the Company following
a Change in Control.
ARTICLE 2
SEVERANCE BENEFITS
2.1 SEVERANCE BENEFITS. If Executive's employment terminates
due to an Involuntary Termination Without Cause or a Constructive
Termination within thirteen (13) months following the effective date
of a Change in Control, such termination of employment will be
deemed a Covered Termination. A Covered Termination entitles
Executive to receive the following benefits set forth in Sections
2.2, 2.3, 2.4, and 2.5.
2.2 SALARY CONTINUATION. Executive shall continue to receive
Base Salary for eighteen (18) months following a Covered
Termination. Such amount shall be paid in regular installments on
the normal payroll dates of the Company and shall be subject to all
required tax withholding.
<PAGE>
2.3 BONUS. The Company shall pay to Executive an amount
equal to one hundred and fifty percent (150%) of the annual bonus
paid to the Executive in the year immediately preceding the
effective date of the Change in Control. Such amount shall be paid
in regular installments on the normal payroll dates of the Company
and shall be subject to all required tax withholding.
2.4 HEALTH BENEFITS. Provided that Executive elects
continued coverage under federal COBRA law, the Company shall pay
the premiums of Executive's group health insurance coverage,
including coverage for Executive's eligible dependents, for a
maximum period of eighteen (18) months following a Covered
Termination; provided, however, that the Company shall pay premiums
for Executive's eligible dependents only for coverage for which
those eligible dependents were enrolled immediately prior to the
Covered Termination. No premium payments will be made following the
effective date of Executive's coverage by a health insurance plan of
a subsequent employer. For the balance of the period that Executive
is entitled to coverage under federal COBRA law, Executive shall be
entitled to maintain such coverage at Executive's own expense.
2.5 OPTION ACCELERATION. If Executive's employment with the
Company terminates due to a Covered Termination, then all options of
Executive to purchase the Company's common stock (or the stock of a
successor to the Company by reason of assumption or substitution of
options) shall become immediately fully vested and exercisable as of
the date of Executive's termination of employment.
2.6 MITIGATION. Except as otherwise specifically provided
herein, Executive shall not be required to mitigate damages or the
amount of any payment provided under this Agreement by seeking other
employment or otherwise, nor shall the amount of any payment
provided for under this Agreement be reduced by any compensation
earned by Executive as a result of employment by another employer or
by any retirement benefits received by Executive after the date of
the Covered Termination.
ARTICLE 3
LIMITATIONS AND CONDITIONS ON BENEFITS
3.1 RELEASE PRIOR TO PAYMENT OF BENEFITS. Upon the
occurrence of a Covered Termination, and prior to the payment of any
benefits under this Agreement on account of such Covered
Termination, Executive shall execute a release (the "Release") in
the form attached hereto and incorporated herein as Exhibit A or
Exhibit B, as applicable. Such Release shall specifically relate to
all of Executive's rights and claims in existence at the time of
such execution and shall confirm Executive's obligations under the
Company's standard form of proprietary information and inventions
agreement. It is understood that, as specified in the applicable
Release, Executive has a certain number of calendar days to consider
whether to execute such Release, and Executive may revoke such
Release within seven (7) calendar days after execution. In the
event Executive does not execute such Release within the applicable
period, or if Executive revokes such Release within the subsequent
seven (7) day period, no benefits shall be payable under this
Agreement, and this Agreement shall be null and void.
<PAGE>
3.2 TERMINATION OF BENEFITS. Benefits under this Agreement
shall terminate immediately if the Executive, at any time, violates
any proprietary information or confidentiality obligation to the
Company.
3.3 NON-DUPLICATION OF BENEFITS. Executive is not eligible
to receive benefits under this Agreement more than one time.
ARTICLE 4
PARACHUTE PAYMENTS
PARACHUTE PAYMENTS. If any payment or benefit Executive would
receive under this Plan, when combined with any other payment or
benefit Executive receives pursuant to the termination of
Executive's employment with the Company ("Payment"), would (i)
constitute a "parachute payment" within the meaning of Section 280G
of the Internal Revenue Code of 1986, as amended (the "Code"), and
(ii) but for this sentence, be subject to the excise tax imposed by
Section 4999 of the Code (the "Excise Tax"), then such Payment shall
be either (x) the full amount of such Payment or (y) such lesser
amount (with cash payments being reduced before stock option
compensation) as would result in no portion of the Payment being
subject to the Excise Tax, whichever of the foregoing amounts,
taking into account the applicable federal, state and local
employment taxes, income taxes, and the Excise Tax results in
Executive's receipt, on an after-tax basis, of the greater amount of
the Payment notwithstanding that all or some portion of the Payment
may be subject to the Excise Tax.
ARTICLE 5
DEFINITIONS
For purposes of the Agreement, the following terms are defined
as follows:
5.1 "BASE SALARY" means Executive's annual base salary as in
effect during the last regularly scheduled payroll period
immediately preceding the Covered Termination.
5.2 "BOARD" means the Board of Directors of the Company.
5.3 "CAUSE" means that, in the reasonable determination of
the Company or, in the case of the Chief Executive Officer, the
Board, Executive:
(A) has committed an act that materially injures the business
of the Company;
(B) has refused or failed to follow lawful and reasonable
directions of the Board or the appropriate individual to whom
Executive reports;
(C) has willfully or habitually neglected Executive's duties
for the Company; or
(D) has been convicted of a felony involving moral turpitude
that is likely to inflict or has inflicted material injury on the
business of the Company.
<PAGE>
Notwithstanding the foregoing, Cause shall not exist based on
conduct described in clause (b) or clause (c) unless the conduct
described in such clause has not been cured within fifteen (15) days
following Executive's receipt of written notice from the Company or
the Board, as the case may be, specifying the particulars of the
conduct constituting Cause.
5.4 "CHANGE IN CONTROL" means
(A) a sale of substantially all of the assets of the Company;
(B) a merger or consolidation in which the Company is not the
surviving corporation (other than a merger or consolidation in which
shareholders immediately before the merger or consolidation have,
immediately after the merger or consolidation, equal or greater
stock voting power);
(C) a reverse merger in which the Company is the surviving
corporation but the shares of the Company's common stock outstanding
immediately preceding the merger are converted by virtue of the
merger into other property, whether in the form of securities, cash
or otherwise (other than a reverse merger in which shareholders
immediately before the merger have, immediately after the merger,
greater stock voting power); or
(D) any transaction or series of related transactions in
which in excess of 50% of the Company's voting power is transferred.
5.5 "COMPANY" means CV Therapeutics, Inc. or, following a
Change in Control, the surviving entity resulting from such
transaction.
5.6 "CONSTRUCTIVE TERMINATION" means that Executive
voluntarily terminates employment within thirteen (13) months
following a Change in Control after any of the following are
undertaken without Executive's express written consent:
(A) the assignment to Executive of any duties or
responsibilities which results in a significant diminution in
Executive's function as in effect immediately prior to the effective
date of the Change in Control; provided, however, that a mere change
in Executive's title or reporting relationships shall not constitute
a Constructive Termination;
(B) a reduction by the Company in Executive's annual base
salary, as in effect on the effective date of the Change in Control
or as increased thereafter;
(C) any failure by the Company to continue in effect any
benefit plan or program, including fringe benefits, incentive plans
and plans with respect to the receipt of securities of the Company,
in which Executive is participating immediately prior to the
effective date of the Change in Control (hereinafter referred to as
"Benefit Plans"); or the taking of any action by the Company that
would adversely affect Executive's participation in or reduce
Executive's benefits under the Benefit Plans; provided, however,
that a "Constructive Termination" shall not exist under this
paragraph following a Change in Control if the Company offers a
range of benefit plans and programs which, taken as a whole, are
comparable to the Benefit Plans;
<PAGE>
(D) a relocation of Executive's business office to a location
more than twenty (20) miles from the location at which Executive
performs duties as of the effective date of the Change in Control,
except for required travel by Executive on the Company's business to
an extent substantially consistent with Executive's business travel
obligations prior to the Change in Control; provided, however, that
if Executive performs sales functions for the Company, a change of
sales territory shall not constitute a basis for Constructive
Termination so long as the Executive's business office is not
relocated as provided above;
(E) a material breach by the Company of any provision of this
Agreement; or
(F) any failure by the Company to obtain the assumption of
this Agreement by any successor or assign of the Company.
5.7 "COVERED TERMINATION" means an Involuntary Termination
Without Cause or a Constructive Termination occurring within
thirteen (13) months following the effective date of a Change in
Control.
5.8 "INVOLUNTARY TERMINATION WITHOUT CAUSE" means Executive's
dismissal or discharge other than for Cause. The termination of
Executive's employment as a result of Executive's death or
disability will not be deemed to be an Involuntary Termination
Without Cause.
ARTICLE 6
GENERAL PROVISIONS
6.1 EMPLOYMENT STATUS. This Agreement does not constitute a
contract of employment or impose upon Executive any obligation to
remain as an employee, or impose on the Company any obligation (i)
to retain Executive as an employee, (ii) to change the status of
Executive as an at-will employee, or (iii) to change the Company's
policies regarding termination of employment.
6.2 NOTICES. Any notices provided hereunder must be in
writing, and such notices or any other written communication shall
be deemed effective upon the earlier of personal delivery (including
personal delivery by facsimile) or the third day after mailing by
first class mail, to the Company at its primary office location and
to Executive at Executive's address as listed in the Company's
payroll records. Any payments made by the Company to Executive
under the terms of this Agreement shall be delivered to Executive
either in person or at the address as listed in the Company's
payroll records.
6.3 SEVERABILITY. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement
is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability will not affect any other provision
or any other jurisdiction, but this Agreement will be reformed,
construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provisions had never been contained herein.
<PAGE>
6.4 WAIVER. If either party should waive any breach of any
provisions of this Agreement, he or it shall not thereby be deemed
to have waived any preceding or succeeding breach of the same or any
other provision of this Agreement.
6.5 ARBITRATION. Unless otherwise prohibited by law or
specified below, all disputes, claims and causes of action, in law
or equity, arising from or relating to this Agreement or its
enforcement, performance, breach, or interpretation shall be
resolved solely and exclusively by final and binding arbitration
held in San Francisco County, California through Judicial
Arbitration & Mediation Services/Endispute ("JAMS") under the then
existing JAMS arbitration rules. However, nothing in this section
is intended to prevent either party from obtaining injunctive relief
in court to prevent irreparable harm pending the conclusion of any
such arbitration. Each party in any such arbitration shall be
responsible for its own attorneys' fees, costs and necessary
disbursement; provided, however, that in the event one party refuses
to arbitrate and the other party seeks to compel arbitration by
court order, if such other party prevails, it shall be entitled to
recover reasonable attorneys' fees, costs and necessary
disbursements. Pursuant to California Civil Code Section 1717, each
party warrants that it was represented by counsel in the negotiation
and execution of this Agreement, including the attorneys' fees
provision herein.
6.6 COMPLETE AGREEMENT. This Agreement, including Exhibit A
and Exhibit B, constitutes the entire agreement between Executive
and the Company and is the complete, final, and exclusive embodiment
of their agreement with regard to this subject matter, wholly
superseding all written and oral agreements with respect to cash
severance benefits and health benefits to Executive in the event of
employment termination other than any outstanding loans by the
Company to Executive. It is entered into without reliance on any
promise or representation other than those expressly contained herein.
6.7 AMENDMENT OR TERMINATION OF AGREEMENT. This Agreement
may be changed or terminated only upon the mutual written consent of
the Company and Executive. The written consent of the Company to a
change or termination of this Agreement must be signed by an
executive officer of the Company after such change or termination
has been approved by the Board.
6.8 COUNTERPARTS. This Agreement may be executed in separate
counterparts, any one of which need not contain signatures of more
than one party, but all of which taken together will constitute one
and the same Agreement.
6.9 HEADINGS. The headings of the Articles and Sections
hereof are inserted for convenience only and shall not be deemed to
constitute a part hereof nor to affect the meaning thereof.
6.10 SUCCESSORS AND ASSIGNS. This Agreement is intended to
bind and inure to the benefit of and be enforceable by Executive,
and the Company, and any surviving entity resulting from a Change in
Control and upon any other person who is a successor by merger,
acquisition, consolidation or otherwise to the business formerly
carried on by the Company, and their respective successors, assigns,
heirs, executors and administrators, without regard to whether or
not such person actively assumes any rights or duties hereunder;
<PAGE>
provided, however, that Executive may not assign any duties
hereunder and may not assign any rights hereunder without the
written consent of the Company, which consent shall not be withheld
unreasonably.
6.11 CHOICE OF LAW. All questions concerning the
construction, validity and interpretation of this Agreement will be
governed by the law of the State of California, without regard to
such state's conflict of laws rules.
6.12 NON-PUBLICATION. The parties mutually agree not to
disclose publicly the terms of this Agreement except to the extent
that disclosure is mandated by applicable law or to respective
advisors (e.g., attorneys, accountants).
6.13 CONSTRUCTION OF AGREEMENT. In the event of a conflict
between the text of the Agreement and any summary, description or
other information regarding the Agreement, the text of the Agreement
shall control.
IN WITNESS WHEREOF, the parties have executed this Agreement on
the Effective Date written above.
CV THERAPEUTICS, INC. DANIEL K. SPIEGELMAN
By: /s/ LOUIS G. LANGE, M.D., PH.D. /s/ DANIEL K. SPIEGELMAN
Name: Louis G. Lange, M.D., Ph.D.
Title: Chairman of the Board & Chief Executive Officer
Exhibit A: Release (Individual Termination)
Exhibit B: Release (Group Termination)
<PAGE>
EXHIBIT A
RELEASE
(INDIVIDUAL TERMINATION)
Certain capitalized terms used in this Release are defined in
the Executive Severance Benefits Agreement (the "Agreement") which I
have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.
I acknowledge that I have read and understand Section 1542 of
the California Civil Code which reads as follows: "A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT
WITH THE DEBTOR." I hereby expressly waive and relinquish all
rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any
claims I may have against the Company.
Except as otherwise set forth in this Release, I hereby
release, acquit and forever discharge the Company, its parents and
subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and
from any and all claims, liabilities, demands, causes of action,
costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise,
known and unknown, suspected and unsuspected, disclosed and
undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment
with the Company), arising out of or in any way related to
agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such
claims and demands directly or indirectly arising out of or in any
way connected with my employment with the Company or the termination
of that employment, including but not limited to, claims of
intentional and negligent infliction of emotional distress, any and
all tort claims for personal injury, claims or demands related to
salary, bonuses, commissions, stock, stock options, or any other
ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance pay, or any other form of disputed
compensation; claims pursuant to any federal, state or local law or
cause of action including, but not limited to, the federal Civil
Rights Act of 1964, as amended; the federal Age Discrimination in
Employment Act of 1967, as amended ("ADEA"); the federal Employee
Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; the California Fair
Employment and Housing Act, as amended; tort law; contract law;
statutory law; common law; wrongful discharge; discrimination;
fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that
nothing in this paragraph shall be construed in any way to release
the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or
applicable law.
<PAGE>
I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under ADEA. I also acknowledge that
the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything
of value to which I was already entitled. I further acknowledge
that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or
claims that may arise on or after the date I execute this Release;
(B) I have the right to consult with an attorney prior to executing
this Release; (C) I have twenty-one (21) days to consider this
Release (although I may choose to voluntarily execute this Release
earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; and (E) this Release
shall not be effective until the date upon which the revocation
period has expired, which shall be the eighth day after this Release
is executed by me.
DANIEL K. SPIEGELMAN
Date:
<PAGE>
EXHIBIT B
RELEASE
(GROUP TERMINATION)
Certain capitalized terms used in this Release are defined in
the Executive Severance Benefits Agreement (the "Agreement") which I
have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.
I acknowledge that I have read and understand Section 1542 of
the California Civil Code which reads as follows: "A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT
WITH THE DEBTOR." I hereby expressly waive and relinquish all
rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any
claims I may have against the Company.
Except as otherwise set forth in this Release, I hereby
release, acquit and forever discharge the Company, its parents and
subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and
from any and all claims, liabilities, demands, causes of action,
costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise,
known and unknown, suspected and unsuspected, disclosed and
undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment
with the Company), arising out of or in any way related to
agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such
claims and demands directly or indirectly arising out of or in any
way connected with my employment with the Company or the termination
of that employment, including but not limited to, claims of
intentional and negligent infliction of emotional distress, any and
all tort claims for personal injury, claims or demands related to
salary, bonuses, commissions, stock, stock options, or any other
ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance pay, or any other form of disputed
compensation; claims pursuant to any federal, state or local law or
cause of action including, but not limited to, the federal Civil
Rights Act of 1964, as amended; the federal Age Discrimination in
Employment Act of 1967, as amended ("ADEA"); the federal Employee
Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; the California Fair
Employment and Housing Act, as amended; tort law; contract law;
statutory law; common law; wrongful discharge; discrimination;
fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that
nothing in this paragraph shall be construed in any way to release
the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or
applicable law.
<PAGE>
I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under ADEA. I also acknowledge that
the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything
of value to which I was already entitled. I further acknowledge
that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or
claims that may arise on or after the date I execute this Release;
(B) I have the right to consult with an attorney prior to executing
this Release; (C) I have forty-five (45) days to consider this
Release (although I may choose to voluntarily execute this Release
earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; (E) this Release shall
not be effective until the date upon which the revocation period has
expired, which shall be the eighth day after this Release is
executed by me; and (F) I have received with this Release a
detailed list of the job titles and ages of all employees who were
terminated in this group termination and the ages of all employees
of the Company in the same job classification or organizational unit
who were not terminated.
DANIEL K. SPIEGELMAN
Date:
<PAGE>
EXECUTIVE
SEVERANCE BENEFITS AGREEMENT
This EXECUTIVE SEVERANCE BENEFITS AGREEMENT (the "AGREEMENT")
is entered into this 2nd day of February, 1999 (the "Effective
Date"), between ANDREW W. WOLFF ("EXECUTIVE") and CV Therapeutics,
Inc. (the "COMPANY"). This Agreement is intended to provide
Executive with the compensation and benefits described herein upon
the occurrence of specific events. Certain capitalized terms used
in this Agreement are defined in Article 5.
The Company and Executive hereby agree as follows:
ARTICLE 1
SCOPE OF AND CONSIDERATION FOR THIS AGREEMENT
1.1 Executive is currently employed by the Company.
1.2 The Company and Executive wish to set forth the
compensation and benefits which Executive shall be entitled to
receive in the event Executive's employment with the Company is
terminated under the circumstances described herein following a
Change in Control.
1.3 The duties and obligations of the Company to Executive
under this Agreement shall be in consideration for Executive's past
services to the Company, Executive's continued employment with the
Company, and Executive's execution of a release in accordance with
Section 3.1.
1.4 This Agreement shall supersede any other agreement
relating to cash severance benefits and health benefits in the event
of Executive's severance from employment with the Company following
a Change in Control.
ARTICLE 2
SEVERANCE BENEFITS
2.1 SEVERANCE BENEFITS. If Executive's employment terminates
due to an Involuntary Termination Without Cause or a Constructive
Termination within thirteen (13) months following the effective date
of a Change in Control, such termination of employment will be
deemed a Covered Termination. A Covered Termination entitles
Executive to receive the following benefits set forth in Sections
2.2, 2.3, 2.4, and 2.5.
2.2 SALARY CONTINUATION. Executive shall continue to receive
Base Salary for eighteen (18) months following a Covered
Termination. Such amount shall be paid in regular installments on
the normal payroll dates of the Company and shall be subject to all
required tax withholding.
<PAGE>
2.3 BONUS. The Company shall pay to Executive an amount
equal to one hundred and fifty percent (150%) of the annual bonus
paid to the Executive in the year immediately preceding the
effective date of the Change in Control. Such amount shall be paid
in regular installments on the normal payroll dates of the Company
and shall be subject to all required tax withholding.
2.4 HEALTH BENEFITS. Provided that Executive elects
continued coverage under federal COBRA law, the Company shall pay
the premiums of Executive's group health insurance coverage,
including coverage for Executive's eligible dependents, for a
maximum period of eighteen (18) months following a Covered
Termination; provided, however, that the Company shall pay premiums
for Executive's eligible dependents only for coverage for which
those eligible dependents were enrolled immediately prior to the
Covered Termination. No premium payments will be made following the
effective date of Executive's coverage by a health insurance plan of
a subsequent employer. For the balance of the period that Executive
is entitled to coverage under federal COBRA law, Executive shall be
entitled to maintain such coverage at Executive's own expense.
2.5 OPTION ACCELERATION. If Executive's employment with the
Company terminates due to a Covered Termination, then all options of
Executive to purchase the Company's common stock (or the stock of a
successor to the Company by reason of assumption or substitution of
options) shall become immediately fully vested and exercisable as of
the date of Executive's termination of employment.
2.6 MITIGATION. Except as otherwise specifically provided
herein, Executive shall not be required to mitigate damages or the
amount of any payment provided under this Agreement by seeking other
employment or otherwise, nor shall the amount of any payment
provided for under this Agreement be reduced by any compensation
earned by Executive as a result of employment by another employer or
by any retirement benefits received by Executive after the date of
the Covered Termination.
ARTICLE 3
LIMITATIONS AND CONDITIONS ON BENEFITS
3.1 RELEASE PRIOR TO PAYMENT OF BENEFITS. Upon the
occurrence of a Covered Termination, and prior to the payment of any
benefits under this Agreement on account of such Covered
Termination, Executive shall execute a release (the "Release") in
the form attached hereto and incorporated herein as Exhibit A or
Exhibit B, as applicable. Such Release shall specifically relate to
all of Executive's rights and claims in existence at the time of
such execution and shall confirm Executive's obligations under the
Company's standard form of proprietary information and inventions
agreement. It is understood that, as specified in the applicable
Release, Executive has a certain number of calendar days to consider
whether to execute such Release, and Executive may revoke such
Release within seven (7) calendar days after execution. In the
event Executive does not execute such Release within the applicable
period, or if Executive revokes such Release within the subsequent
seven (7) day period, no benefits shall be payable under this
Agreement, and this Agreement shall be null and void.
<PAGE>
3.2 TERMINATION OF BENEFITS. Benefits under this Agreement
shall terminate immediately if the Executive, at any time, violates
any proprietary information or confidentiality obligation to the
Company.
3.3 NON-DUPLICATION OF BENEFITS. Executive is not eligible
to receive benefits under this Agreement more than one time.
ARTICLE 4
PARACHUTE PAYMENTS
PARACHUTE PAYMENTS. If any payment or benefit Executive would
receive under this Plan, when combined with any other payment or
benefit Executive receives pursuant to the termination of
Executive's employment with the Company ("Payment"), would (i)
constitute a "parachute payment" within the meaning of Section 280G
of the Internal Revenue Code of 1986, as amended (the "Code"), and
(ii) but for this sentence, be subject to the excise tax imposed by
Section 4999 of the Code (the "Excise Tax"), then such Payment shall
be either (x) the full amount of such Payment or (y) such lesser
amount (with cash payments being reduced before stock option
compensation) as would result in no portion of the Payment being
subject to the Excise Tax, whichever of the foregoing amounts,
taking into account the applicable federal, state and local
employment taxes, income taxes, and the Excise Tax results in
Executive's receipt, on an after-tax basis, of the greater amount of
the Payment notwithstanding that all or some portion of the Payment
may be subject to the Excise Tax.
ARTICLE 5
DEFINITIONS
For purposes of the Agreement, the following terms are defined
as follows:
5.1 "BASE SALARY" means Executive's annual base salary as in
effect during the last regularly scheduled payroll period
immediately preceding the Covered Termination.
5.2 "BOARD" means the Board of Directors of the Company.
5.3 "CAUSE" means that, in the reasonable determination of
the Company or, in the case of the Chief Executive Officer, the
Board, Executive:
(A) has committed an act that materially injures the business
of the Company;
(B) has refused or failed to follow lawful and reasonable
directions of the Board or the appropriate individual to whom
Executive reports;
(C) has willfully or habitually neglected Executive's duties
for the Company; or
(D) has been convicted of a felony involving moral turpitude
that is likely to inflict or has inflicted material injury on the
business of the Company.
<PAGE>
Notwithstanding the foregoing, Cause shall not exist based on
conduct described in clause (b) or clause (c) unless the conduct
described in such clause has not been cured within fifteen (15) days
following Executive's receipt of written notice from the Company or
the Board, as the case may be, specifying the particulars of the
conduct constituting Cause.
5.4 "CHANGE IN CONTROL" means
(A) a sale of substantially all of the assets of the Company;
(B) a merger or consolidation in which the Company is not the
surviving corporation (other than a merger or consolidation in which
shareholders immediately before the merger or consolidation have,
immediately after the merger or consolidation, equal or greater
stock voting power);
(C) a reverse merger in which the Company is the surviving
corporation but the shares of the Company's common stock outstanding
immediately preceding the merger are converted by virtue of the
merger into other property, whether in the form of securities, cash
or otherwise (other than a reverse merger in which shareholders
immediately before the merger have, immediately after the merger,
greater stock voting power); or
(D) any transaction or series of related transactions in
which in excess of 50% of the Company's voting power is transferred.
5.5 "COMPANY" means CV Therapeutics, Inc. or, following a
Change in Control, the surviving entity resulting from such
transaction.
5.6 "CONSTRUCTIVE TERMINATION" means that Executive
voluntarily terminates employment within thirteen (13) months
following a Change in Control after any of the following are
undertaken without Executive's express written consent:
(A) the assignment to Executive of any duties or
responsibilities which results in a significant diminution in
Executive's function as in effect immediately prior to the effective
date of the Change in Control; provided, however, that a mere change
in Executive's title or reporting relationships shall not constitute
a Constructive Termination;
(B) a reduction by the Company in Executive's annual base
salary, as in effect on the effective date of the Change in Control
or as increased thereafter;
(C) any failure by the Company to continue in effect any
benefit plan or program, including fringe benefits, incentive plans
and plans with respect to the receipt of securities of the Company,
in which Executive is participating immediately prior to the
effective date of the Change in Control (hereinafter referred to as
"Benefit Plans"); or the taking of any action by the Company that
would adversely affect Executive's participation in or reduce
Executive's benefits under the Benefit Plans; provided, however,
that a "Constructive Termination" shall not exist under this
paragraph following a Change in Control if the Company offers a
range of benefit plans and programs which, taken as a whole, are
comparable to the Benefit Plans;
<PAGE>
(D) a relocation of Executive's business office to a location
more than twenty (20) miles from the location at which Executive
performs duties as of the effective date of the Change in Control,
except for required travel by Executive on the Company's business to
an extent substantially consistent with Executive's business travel
obligations prior to the Change in Control; provided, however, that
if Executive performs sales functions for the Company, a change of
sales territory shall not constitute a basis for Constructive
Termination so long as the Executive's business office is not
relocated as provided above;
(E) a material breach by the Company of any provision of this
Agreement; or
(F) any failure by the Company to obtain the assumption of
this Agreement by any successor or assign of the Company.
5.7 "COVERED TERMINATION" means an Involuntary Termination
Without Cause or a Constructive Termination occurring within
thirteen (13) months following the effective date of a Change in
Control.
5.8 "INVOLUNTARY TERMINATION WITHOUT CAUSE" means Executive's
dismissal or discharge other than for Cause. The termination of
Executive's employment as a result of Executive's death or
disability will not be deemed to be an Involuntary Termination
Without Cause.
ARTICLE 6
GENERAL PROVISIONS
6.1 EMPLOYMENT STATUS. This Agreement does not constitute a
contract of employment or impose upon Executive any obligation to
remain as an employee, or impose on the Company any obligation (i)
to retain Executive as an employee, (ii) to change the status of
Executive as an at-will employee, or (iii) to change the Company's
policies regarding termination of employment.
6.2 NOTICES. Any notices provided hereunder must be in
writing, and such notices or any other written communication shall
be deemed effective upon the earlier of personal delivery (including
personal delivery by facsimile) or the third day after mailing by
first class mail, to the Company at its primary office location and
to Executive at Executive's address as listed in the Company's
payroll records. Any payments made by the Company to Executive
under the terms of this Agreement shall be delivered to Executive
either in person or at the address as listed in the Company's
payroll records.
6.3 SEVERABILITY. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement
is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability will not affect any other provision
or any other jurisdiction, but this Agreement will be reformed,
construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provisions had never been contained herein.
<PAGE>
6.4 WAIVER. If either party should waive any breach of any
provisions of this Agreement, he or it shall not thereby be deemed
to have waived any preceding or succeeding breach of the same or any
other provision of this Agreement.
6.5 ARBITRATION. Unless otherwise prohibited by law or
specified below, all disputes, claims and causes of action, in law
or equity, arising from or relating to this Agreement or its
enforcement, performance, breach, or interpretation shall be
resolved solely and exclusively by final and binding arbitration
held in San Francisco County, California through Judicial
Arbitration & Mediation Services/Endispute ("JAMS") under the then
existing JAMS arbitration rules. However, nothing in this section
is intended to prevent either party from obtaining injunctive relief
in court to prevent irreparable harm pending the conclusion of any
such arbitration. Each party in any such arbitration shall be
responsible for its own attorneys' fees, costs and necessary
disbursement; provided, however, that in the event one party refuses
to arbitrate and the other party seeks to compel arbitration by
court order, if such other party prevails, it shall be entitled to
recover reasonable attorneys' fees, costs and necessary
disbursements. Pursuant to California Civil Code Section 1717, each
party warrants that it was represented by counsel in the negotiation
and execution of this Agreement, including the attorneys' fees
provision herein.
6.6 COMPLETE AGREEMENT. This Agreement, including Exhibit A
and Exhibit B, constitutes the entire agreement between Executive
and the Company and is the complete, final, and exclusive embodiment
of their agreement with regard to this subject matter, wholly
superseding all written and oral agreements with respect to cash
severance benefits and health benefits to Executive in the event of
employment termination other than any outstanding loans by the
Company to Executive. It is entered into without reliance on any
promise or representation other than those expressly contained herein.
6.7 AMENDMENT OR TERMINATION OF AGREEMENT. This Agreement
may be changed or terminated only upon the mutual written consent of
the Company and Executive. The written consent of the Company to a
change or termination of this Agreement must be signed by an
executive officer of the Company after such change or termination
has been approved by the Board.
6.8 COUNTERPARTS. This Agreement may be executed in separate
counterparts, any one of which need not contain signatures of more
than one party, but all of which taken together will constitute one
and the same Agreement.
6.9 HEADINGS. The headings of the Articles and Sections
hereof are inserted for convenience only and shall not be deemed to
constitute a part hereof nor to affect the meaning thereof.
6.10 SUCCESSORS AND ASSIGNS. This Agreement is intended to
bind and inure to the benefit of and be enforceable by Executive,
and the Company, and any surviving entity resulting from a Change in
Control and upon any other person who is a successor by merger,
acquisition, consolidation or otherwise to the business formerly
carried on by the Company, and their respective successors, assigns,
heirs, executors and administrators, without regard to whether or
not such person actively assumes any rights or duties hereunder;
<PAGE>
provided, however, that Executive may not assign any duties
hereunder and may not assign any rights hereunder without the
written consent of the Company, which consent shall not be withheld
unreasonably.
6.11 CHOICE OF LAW. All questions concerning the
construction, validity and interpretation of this Agreement will be
governed by the law of the State of California, without regard to
such state's conflict of laws rules.
6.12 NON-PUBLICATION. The parties mutually agree not to
disclose publicly the terms of this Agreement except to the extent
that disclosure is mandated by applicable law or to respective
advisors (e.g., attorneys, accountants).
6.13 CONSTRUCTION OF AGREEMENT. In the event of a conflict
between the text of the Agreement and any summary, description or
other information regarding the Agreement, the text of the Agreement
shall control.
IN WITNESS WHEREOF, the parties have executed this Agreement on
the Effective Date written above.
CV THERAPEUTICS, INC. ANDREW W. WOLFF
By: /s/ LOUIS G. LANGE, M.D., PH.D. /s/ ANDREW W. WOLFF
Name: Louis G. Lange, M.D., Ph.D.
Title: Chairman of the Board & Chief Executive Officer
Exhibit A: Release (Individual Termination)
Exhibit B: Release (Group Termination)
<PAGE>
EXHIBIT A
RELEASE
(INDIVIDUAL TERMINATION)
Certain capitalized terms used in this Release are defined in
the Executive Severance Benefits Agreement (the "Agreement") which I
have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.
I acknowledge that I have read and understand Section 1542 of
the California Civil Code which reads as follows: "A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT
WITH THE DEBTOR." I hereby expressly waive and relinquish all
rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any
claims I may have against the Company.
Except as otherwise set forth in this Release, I hereby
release, acquit and forever discharge the Company, its parents and
subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and
from any and all claims, liabilities, demands, causes of action,
costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise,
known and unknown, suspected and unsuspected, disclosed and
undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment
with the Company), arising out of or in any way related to
agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such
claims and demands directly or indirectly arising out of or in any
way connected with my employment with the Company or the termination
of that employment, including but not limited to, claims of
intentional and negligent infliction of emotional distress, any and
all tort claims for personal injury, claims or demands related to
salary, bonuses, commissions, stock, stock options, or any other
ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance pay, or any other form of disputed
compensation; claims pursuant to any federal, state or local law or
cause of action including, but not limited to, the federal Civil
Rights Act of 1964, as amended; the federal Age Discrimination in
Employment Act of 1967, as amended ("ADEA"); the federal Employee
Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; the California Fair
Employment and Housing Act, as amended; tort law; contract law;
statutory law; common law; wrongful discharge; discrimination;
fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that
nothing in this paragraph shall be construed in any way to release
the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or
applicable law.
<PAGE>
I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under ADEA. I also acknowledge that
the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything
of value to which I was already entitled. I further acknowledge
that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or
claims that may arise on or after the date I execute this Release;
(B) I have the right to consult with an attorney prior to executing
this Release; (C) I have twenty-one (21) days to consider this
Release (although I may choose to voluntarily execute this Release
earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; and (E) this Release
shall not be effective until the date upon which the revocation
period has expired, which shall be the eighth day after this Release
is executed by me.
ANDREW W. WOLFF
Date:
<PAGE>
EXHIBIT B
RELEASE
(GROUP TERMINATION)
Certain capitalized terms used in this Release are defined in
the Executive Severance Benefits Agreement (the "Agreement") which I
have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.
I acknowledge that I have read and understand Section 1542 of
the California Civil Code which reads as follows: "A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT
WITH THE DEBTOR." I hereby expressly waive and relinquish all
rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any
claims I may have against the Company.
Except as otherwise set forth in this Release, I hereby
release, acquit and forever discharge the Company, its parents and
subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and
from any and all claims, liabilities, demands, causes of action,
costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise,
known and unknown, suspected and unsuspected, disclosed and
undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment
with the Company), arising out of or in any way related to
agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such
claims and demands directly or indirectly arising out of or in any
way connected with my employment with the Company or the termination
of that employment, including but not limited to, claims of
intentional and negligent infliction of emotional distress, any and
all tort claims for personal injury, claims or demands related to
salary, bonuses, commissions, stock, stock options, or any other
ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance pay, or any other form of disputed
compensation; claims pursuant to any federal, state or local law or
cause of action including, but not limited to, the federal Civil
Rights Act of 1964, as amended; the federal Age Discrimination in
Employment Act of 1967, as amended ("ADEA"); the federal Employee
Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; the California Fair
Employment and Housing Act, as amended; tort law; contract law;
statutory law; common law; wrongful discharge; discrimination;
fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that
nothing in this paragraph shall be construed in any way to release
the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or
applicable law.
<PAGE>
I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under ADEA. I also acknowledge that
the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything
of value to which I was already entitled. I further acknowledge
that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or
claims that may arise on or after the date I execute this Release;
(B) I have the right to consult with an attorney prior to executing
this Release; (C) I have forty-five (45) days to consider this
Release (although I may choose to voluntarily execute this Release
earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; (E) this Release shall
not be effective until the date upon which the revocation period has
expired, which shall be the eighth day after this Release is
executed by me; and (F) I have received with this Release a
detailed list of the job titles and ages of all employees who were
terminated in this group termination and the ages of all employees
of the Company in the same job classification or organizational unit
who were not terminated.
ANDREW W. WOLFF
Date:
<PAGE>
EXECUTIVE
SEVERANCE BENEFITS AGREEMENT
This EXECUTIVE SEVERANCE BENEFITS AGREEMENT (the "AGREEMENT")
is entered into this 2nd day of February, 1999 (the "Effective
Date"), between CYNTHIA L. CLARK ("EXECUTIVE") and CV Therapeutics,
Inc. (the "COMPANY"). This Agreement is intended to provide
Executive with the compensation and benefits described herein upon
the occurrence of specific events. Certain capitalized terms used
in this Agreement are defined in Article 5.
The Company and Executive hereby agree as follows:
ARTICLE 1
SCOPE OF AND CONSIDERATION FOR THIS AGREEMENT
1.1 Executive is currently employed by the Company.
1.2 The Company and Executive wish to set forth the
compensation and benefits which Executive shall be entitled to
receive in the event Executive's employment with the Company is
terminated under the circumstances described herein following a
Change in Control.
1.3 The duties and obligations of the Company to Executive
under this Agreement shall be in consideration for Executive's past
services to the Company, Executive's continued employment with the
Company, and Executive's execution of a release in accordance with
Section 3.1.
1.4 This Agreement shall supersede any other agreement
relating to cash severance benefits and health benefits in the event
of Executive's severance from employment with the Company following
a Change in Control.
ARTICLE 2
SEVERANCE BENEFITS
2.1 SEVERANCE BENEFITS. If Executive's employment terminates
due to an Involuntary Termination Without Cause or a Constructive
Termination within thirteen (13) months following the effective date
of a Change in Control, such termination of employment will be
deemed a Covered Termination. A Covered Termination entitles
Executive to receive the following benefits set forth in Sections
2.2, 2.3, 2.4, and 2.5.
2.2 SALARY CONTINUATION. Executive shall continue to receive
Base Salary for eighteen (18) months following a Covered
Termination. Such amount shall be paid in regular installments on
the normal payroll dates of the Company and shall be subject to all
required tax withholding.
<PAGE>
2.3 BONUS. The Company shall pay to Executive an amount
equal to one hundred and fifty percent (150%) of the annual bonus
paid to the Executive in the year immediately preceding the
effective date of the Change in Control. Such amount shall be paid
in regular installments on the normal payroll dates of the Company
and shall be subject to all required tax withholding.
2.4 HEALTH BENEFITS. Provided that Executive elects
continued coverage under federal COBRA law, the Company shall pay
the premiums of Executive's group health insurance coverage,
including coverage for Executive's eligible dependents, for a
maximum period of eighteen (18) months following a Covered
Termination; provided, however, that the Company shall pay premiums
for Executive's eligible dependents only for coverage for which
those eligible dependents were enrolled immediately prior to the
Covered Termination. No premium payments will be made following the
effective date of Executive's coverage by a health insurance plan of
a subsequent employer. For the balance of the period that Executive
is entitled to coverage under federal COBRA law, Executive shall be
entitled to maintain such coverage at Executive's own expense.
2.5 OPTION ACCELERATION. If Executive's employment with the
Company terminates due to a Covered Termination, then all options of
Executive to purchase the Company's common stock (or the stock of a
successor to the Company by reason of assumption or substitution of
options) shall become immediately fully vested and exercisable as of
the date of Executive's termination of employment.
2.6 MITIGATION. Except as otherwise specifically provided
herein, Executive shall not be required to mitigate damages or the
amount of any payment provided under this Agreement by seeking other
employment or otherwise, nor shall the amount of any payment
provided for under this Agreement be reduced by any compensation
earned by Executive as a result of employment by another employer or
by any retirement benefits received by Executive after the date of
the Covered Termination.
ARTICLE 3
LIMITATIONS AND CONDITIONS ON BENEFITS
3.1 RELEASE PRIOR TO PAYMENT OF BENEFITS. Upon the
occurrence of a Covered Termination, and prior to the payment of any
benefits under this Agreement on account of such Covered
Termination, Executive shall execute a release (the "Release") in
the form attached hereto and incorporated herein as Exhibit A or
Exhibit B, as applicable. Such Release shall specifically relate to
all of Executive's rights and claims in existence at the time of
such execution and shall confirm Executive's obligations under the
Company's standard form of proprietary information and inventions
agreement. It is understood that, as specified in the applicable
Release, Executive has a certain number of calendar days to consider
whether to execute such Release, and Executive may revoke such
Release within seven (7) calendar days after execution. In the
event Executive does not execute such Release within the applicable
period, or if Executive revokes such Release within the subsequent
seven (7) day period, no benefits shall be payable under this
Agreement, and this Agreement shall be null and void.
<PAGE>
3.2 TERMINATION OF BENEFITS. Benefits under this Agreement
shall terminate immediately if the Executive, at any time, violates
any proprietary information or confidentiality obligation to the
Company.
3.3 NON-DUPLICATION OF BENEFITS. Executive is not eligible
to receive benefits under this Agreement more than one time.
ARTICLE 4
PARACHUTE PAYMENTS
PARACHUTE PAYMENTS. If any payment or benefit Executive would
receive under this Plan, when combined with any other payment or
benefit Executive receives pursuant to the termination of
Executive's employment with the Company ("Payment"), would (i)
constitute a "parachute payment" within the meaning of Section 280G
of the Internal Revenue Code of 1986, as amended (the "Code"), and
(ii) but for this sentence, be subject to the excise tax imposed by
Section 4999 of the Code (the "Excise Tax"), then such Payment shall
be either (x) the full amount of such Payment or (y) such lesser
amount (with cash payments being reduced before stock option
compensation) as would result in no portion of the Payment being
subject to the Excise Tax, whichever of the foregoing amounts,
taking into account the applicable federal, state and local
employment taxes, income taxes, and the Excise Tax results in
Executive's receipt, on an after-tax basis, of the greater amount of
the Payment notwithstanding that all or some portion of the Payment
may be subject to the Excise Tax.
ARTICLE 5
DEFINITIONS
For purposes of the Agreement, the following terms are defined
as follows:
5.1 "BASE SALARY" means Executive's annual base salary as in
effect during the last regularly scheduled payroll period
immediately preceding the Covered Termination.
5.2 "BOARD" means the Board of Directors of the Company.
5.3 "CAUSE" means that, in the reasonable determination of
the Company or, in the case of the Chief Executive Officer, the
Board, Executive:
(A) has committed an act that materially injures the business
of the Company;
(B) has refused or failed to follow lawful and reasonable
directions of the Board or the appropriate individual to whom
Executive reports;
(C) has willfully or habitually neglected Executive's duties
for the Company; or
(D) has been convicted of a felony involving moral turpitude
that is likely to inflict or has inflicted material injury on the
business of the Company.
<PAGE>
Notwithstanding the foregoing, Cause shall not exist based on
conduct described in clause (b) or clause (c) unless the conduct
described in such clause has not been cured within fifteen (15) days
following Executive's receipt of written notice from the Company or
the Board, as the case may be, specifying the particulars of the
conduct constituting Cause.
5.4 "CHANGE IN CONTROL" means
(A) a sale of substantially all of the assets of the Company;
(B) a merger or consolidation in which the Company is not the
surviving corporation (other than a merger or consolidation in which
shareholders immediately before the merger or consolidation have,
immediately after the merger or consolidation, equal or greater
stock voting power);
(C) a reverse merger in which the Company is the surviving
corporation but the shares of the Company's common stock outstanding
immediately preceding the merger are converted by virtue of the
merger into other property, whether in the form of securities, cash
or otherwise (other than a reverse merger in which shareholders
immediately before the merger have, immediately after the merger,
greater stock voting power); or
(D) any transaction or series of related transactions in
which in excess of 50% of the Company's voting power is transferred.
5.5 "COMPANY" means CV Therapeutics, Inc. or, following a
Change in Control, the surviving entity resulting from such
transaction.
5.6 "CONSTRUCTIVE TERMINATION" means that Executive
voluntarily terminates employment within thirteen (13) months
following a Change in Control after any of the following are
undertaken without Executive's express written consent:
(A) the assignment to Executive of any duties or
responsibilities which results in a significant diminution in
Executive's function as in effect immediately prior to the effective
date of the Change in Control; provided, however, that a mere change
in Executive's title or reporting relationships shall not constitute
a Constructive Termination;
(B) a reduction by the Company in Executive's annual base
salary, as in effect on the effective date of the Change in Control
or as increased thereafter;
(C) any failure by the Company to continue in effect any
benefit plan or program, including fringe benefits, incentive plans
and plans with respect to the receipt of securities of the Company,
in which Executive is participating immediately prior to the
effective date of the Change in Control (hereinafter referred to as
"Benefit Plans"); or the taking of any action by the Company that
would adversely affect Executive's participation in or reduce
Executive's benefits under the Benefit Plans; provided, however,
that a "Constructive Termination" shall not exist under this
paragraph following a Change in Control if the Company offers a
range of benefit plans and programs which, taken as a whole, are
comparable to the Benefit Plans;
<PAGE>
(D) a relocation of Executive's business office to a location
more than twenty (20) miles from the location at which Executive
performs duties as of the effective date of the Change in Control,
except for required travel by Executive on the Company's business to
an extent substantially consistent with Executive's business travel
obligations prior to the Change in Control; provided, however, that
if Executive performs sales functions for the Company, a change of
sales territory shall not constitute a basis for Constructive
Termination so long as the Executive's business office is not
relocated as provided above;
(E) a material breach by the Company of any provision of this
Agreement; or
(F) any failure by the Company to obtain the assumption of
this Agreement by any successor or assign of the Company.
5.7 "COVERED TERMINATION" means an Involuntary Termination
Without Cause or a Constructive Termination occurring within
thirteen (13) months following the effective date of a Change in
Control.
5.8 "INVOLUNTARY TERMINATION WITHOUT CAUSE" means Executive's
dismissal or discharge other than for Cause. The termination of
Executive's employment as a result of Executive's death or
disability will not be deemed to be an Involuntary Termination
Without Cause.
ARTICLE 6
GENERAL PROVISIONS
6.1 EMPLOYMENT STATUS. This Agreement does not constitute a
contract of employment or impose upon Executive any obligation to
remain as an employee, or impose on the Company any obligation (i)
to retain Executive as an employee, (ii) to change the status of
Executive as an at-will employee, or (iii) to change the Company's
policies regarding termination of employment.
6.2 NOTICES. Any notices provided hereunder must be in
writing, and such notices or any other written communication shall
be deemed effective upon the earlier of personal delivery (including
personal delivery by facsimile) or the third day after mailing by
first class mail, to the Company at its primary office location and
to Executive at Executive's address as listed in the Company's
payroll records. Any payments made by the Company to Executive
under the terms of this Agreement shall be delivered to Executive
either in person or at the address as listed in the Company's
payroll records.
6.3 SEVERABILITY. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement
is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability will not affect any other provision
or any other jurisdiction, but this Agreement will be reformed,
construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provisions had never been contained herein.
<PAGE>
6.4 WAIVER. If either party should waive any breach of any
provisions of this Agreement, he or it shall not thereby be deemed
to have waived any preceding or succeeding breach of the same or any
other provision of this Agreement.
6.5 ARBITRATION. Unless otherwise prohibited by law or
specified below, all disputes, claims and causes of action, in law
or equity, arising from or relating to this Agreement or its
enforcement, performance, breach, or interpretation shall be
resolved solely and exclusively by final and binding arbitration
held in San Francisco County, California through Judicial
Arbitration & Mediation Services/Endispute ("JAMS") under the then
existing JAMS arbitration rules. However, nothing in this section
is intended to prevent either party from obtaining injunctive relief
in court to prevent irreparable harm pending the conclusion of any
such arbitration. Each party in any such arbitration shall be
responsible for its own attorneys' fees, costs and necessary
disbursement; provided, however, that in the event one party refuses
to arbitrate and the other party seeks to compel arbitration by
court order, if such other party prevails, it shall be entitled to
recover reasonable attorneys' fees, costs and necessary
disbursements. Pursuant to California Civil Code Section 1717, each
party warrants that it was represented by counsel in the negotiation
and execution of this Agreement, including the attorneys' fees
provision herein.
6.6 COMPLETE AGREEMENT. This Agreement, including Exhibit A
and Exhibit B, constitutes the entire agreement between Executive
and the Company and is the complete, final, and exclusive embodiment
of their agreement with regard to this subject matter, wholly
superseding all written and oral agreements with respect to cash
severance benefits and health benefits to Executive in the event of
employment termination other than any outstanding loans by the
Company to Executive. It is entered into without reliance on any
promise or representation other than those expressly contained herein.
6.7 AMENDMENT OR TERMINATION OF AGREEMENT. This Agreement
may be changed or terminated only upon the mutual written consent of
the Company and Executive. The written consent of the Company to a
change or termination of this Agreement must be signed by an
executive officer of the Company after such change or termination
has been approved by the Board.
6.8 COUNTERPARTS. This Agreement may be executed in separate
counterparts, any one of which need not contain signatures of more
than one party, but all of which taken together will constitute one
and the same Agreement.
6.9 HEADINGS. The headings of the Articles and Sections
hereof are inserted for convenience only and shall not be deemed to
constitute a part hereof nor to affect the meaning thereof.
6.10 SUCCESSORS AND ASSIGNS. This Agreement is intended to
bind and inure to the benefit of and be enforceable by Executive,
and the Company, and any surviving entity resulting from a Change in
Control and upon any other person who is a successor by merger,
acquisition, consolidation or otherwise to the business formerly
carried on by the Company, and their respective successors, assigns,
heirs, executors and administrators, without regard to whether or
not such person actively assumes any rights or duties hereunder;
<PAGE>
provided, however, that Executive may not assign any duties
hereunder and may not assign any rights hereunder without the
written consent of the Company, which consent shall not be withheld
unreasonably.
6.11 CHOICE OF LAW. All questions concerning the
construction, validity and interpretation of this Agreement will be
governed by the law of the State of California, without regard to
such state's conflict of laws rules.
6.12 NON-PUBLICATION. The parties mutually agree not to
disclose publicly the terms of this Agreement except to the extent
that disclosure is mandated by applicable law or to respective
advisors (e.g., attorneys, accountants).
6.13 CONSTRUCTION OF AGREEMENT. In the event of a conflict
between the text of the Agreement and any summary, description or
other information regarding the Agreement, the text of the Agreement
shall control.
IN WITNESS WHEREOF, the parties have executed this Agreement on
the Effective Date written above.
CV THERAPEUTICS, INC. CYNTHIA L. CLARK
By: /s/ LOUIS G. LANGE, M.D., PH.D. /s/ CYNTHIA L. CLARK
Name: Louis G. Lange, M.D., Ph.D.
Title: Chairman of the Board & Chief Executive Officer
Exhibit A: Release (Individual Termination)
Exhibit B: Release (Group Termination)
<PAGE>
EXHIBIT A
RELEASE
(INDIVIDUAL TERMINATION)
Certain capitalized terms used in this Release are defined in
the Executive Severance Benefits Agreement (the "Agreement") which I
have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.
I acknowledge that I have read and understand Section 1542 of
the California Civil Code which reads as follows: "A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT
WITH THE DEBTOR." I hereby expressly waive and relinquish all
rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any
claims I may have against the Company.
Except as otherwise set forth in this Release, I hereby
release, acquit and forever discharge the Company, its parents and
subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and
from any and all claims, liabilities, demands, causes of action,
costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise,
known and unknown, suspected and unsuspected, disclosed and
undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment
with the Company), arising out of or in any way related to
agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such
claims and demands directly or indirectly arising out of or in any
way connected with my employment with the Company or the termination
of that employment, including but not limited to, claims of
intentional and negligent infliction of emotional distress, any and
all tort claims for personal injury, claims or demands related to
salary, bonuses, commissions, stock, stock options, or any other
ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance pay, or any other form of disputed
compensation; claims pursuant to any federal, state or local law or
cause of action including, but not limited to, the federal Civil
Rights Act of 1964, as amended; the federal Age Discrimination in
Employment Act of 1967, as amended ("ADEA"); the federal Employee
Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; the California Fair
Employment and Housing Act, as amended; tort law; contract law;
statutory law; common law; wrongful discharge; discrimination;
fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that
nothing in this paragraph shall be construed in any way to release
the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or
applicable law.
<PAGE>
I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under ADEA. I also acknowledge that
the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything
of value to which I was already entitled. I further acknowledge
that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or
claims that may arise on or after the date I execute this Release;
(B) I have the right to consult with an attorney prior to executing
this Release; (C) I have twenty-one (21) days to consider this
Release (although I may choose to voluntarily execute this Release
earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; and (E) this Release
shall not be effective until the date upon which the revocation
period has expired, which shall be the eighth day after this Release
is executed by me.
CYNTHIA L. CLARK
Date:
<PAGE>
EXHIBIT B
RELEASE
(GROUP TERMINATION)
Certain capitalized terms used in this Release are defined in
the Executive Severance Benefits Agreement (the "Agreement") which I
have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.
I acknowledge that I have read and understand Section 1542 of
the California Civil Code which reads as follows: "A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT
WITH THE DEBTOR." I hereby expressly waive and relinquish all
rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any
claims I may have against the Company.
Except as otherwise set forth in this Release, I hereby
release, acquit and forever discharge the Company, its parents and
subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and
from any and all claims, liabilities, demands, causes of action,
costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise,
known and unknown, suspected and unsuspected, disclosed and
undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment
with the Company), arising out of or in any way related to
agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such
claims and demands directly or indirectly arising out of or in any
way connected with my employment with the Company or the termination
of that employment, including but not limited to, claims of
intentional and negligent infliction of emotional distress, any and
all tort claims for personal injury, claims or demands related to
salary, bonuses, commissions, stock, stock options, or any other
ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance pay, or any other form of disputed
compensation; claims pursuant to any federal, state or local law or
cause of action including, but not limited to, the federal Civil
Rights Act of 1964, as amended; the federal Age Discrimination in
Employment Act of 1967, as amended ("ADEA"); the federal Employee
Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; the California Fair
Employment and Housing Act, as amended; tort law; contract law;
statutory law; common law; wrongful discharge; discrimination;
fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that
nothing in this paragraph shall be construed in any way to release
the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or
applicable law.
<PAGE>
I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under ADEA. I also acknowledge that
the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything
of value to which I was already entitled. I further acknowledge
that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or
claims that may arise on or after the date I execute this Release;
(B) I have the right to consult with an attorney prior to executing
this Release; (C) I have forty-five (45) days to consider this
Release (although I may choose to voluntarily execute this Release
earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; (E) this Release shall
not be effective until the date upon which the revocation period has
expired, which shall be the eighth day after this Release is
executed by me; and (F) I have received with this Release a
detailed list of the job titles and ages of all employees who were
terminated in this group termination and the ages of all employees
of the Company in the same job classification or organizational unit
who were not terminated.
CYNTHIA L. CLARK
Date:
<PAGE>
EXECUTIVE
SEVERANCE BENEFITS AGREEMENT
This EXECUTIVE SEVERANCE BENEFITS AGREEMENT (the "AGREEMENT")
is entered into this 2nd day of February, 1999 (the "Effective
Date"), between BRENT K. BLACKBURN ("EXECUTIVE") and CV Therapeutics,
Inc. (the "COMPANY"). This Agreement is intended to provide
Executive with the compensation and benefits described herein upon
the occurrence of specific events. Certain capitalized terms used
in this Agreement are defined in Article 5.
The Company and Executive hereby agree as follows:
ARTICLE 1
SCOPE OF AND CONSIDERATION FOR THIS AGREEMENT
1.1 Executive is currently employed by the Company.
1.2 The Company and Executive wish to set forth the
compensation and benefits which Executive shall be entitled to
receive in the event Executive's employment with the Company is
terminated under the circumstances described herein following a
Change in Control.
1.3 The duties and obligations of the Company to Executive
under this Agreement shall be in consideration for Executive's past
services to the Company, Executive's continued employment with the
Company, and Executive's execution of a release in accordance with
Section 3.1.
1.4 This Agreement shall supersede any other agreement
relating to cash severance benefits and health benefits in the event
of Executive's severance from employment with the Company following
a Change in Control.
ARTICLE 2
SEVERANCE BENEFITS
2.1 SEVERANCE BENEFITS. If Executive's employment terminates
due to an Involuntary Termination Without Cause or a Constructive
Termination within thirteen (13) months following the effective date
of a Change in Control, such termination of employment will be
deemed a Covered Termination. A Covered Termination entitles
Executive to receive the following benefits set forth in Sections
2.2, 2.3, 2.4, and 2.5.
2.2 SALARY CONTINUATION. Executive shall continue to receive
Base Salary for eighteen (18) months following a Covered
Termination. Such amount shall be paid in regular installments on
the normal payroll dates of the Company and shall be subject to all
required tax withholding.
<PAGE>
2.3 BONUS. The Company shall pay to Executive an amount
equal to one hundred and fifty percent (150%) of the annual bonus
paid to the Executive in the year immediately preceding the
effective date of the Change in Control. Such amount shall be paid
in regular installments on the normal payroll dates of the Company
and shall be subject to all required tax withholding.
2.4 HEALTH BENEFITS. Provided that Executive elects
continued coverage under federal COBRA law, the Company shall pay
the premiums of Executive's group health insurance coverage,
including coverage for Executive's eligible dependents, for a
maximum period of eighteen (18) months following a Covered
Termination; provided, however, that the Company shall pay premiums
for Executive's eligible dependents only for coverage for which
those eligible dependents were enrolled immediately prior to the
Covered Termination. No premium payments will be made following the
effective date of Executive's coverage by a health insurance plan of
a subsequent employer. For the balance of the period that Executive
is entitled to coverage under federal COBRA law, Executive shall be
entitled to maintain such coverage at Executive's own expense.
2.5 OPTION ACCELERATION. If Executive's employment with the
Company terminates due to a Covered Termination, then all options of
Executive to purchase the Company's common stock (or the stock of a
successor to the Company by reason of assumption or substitution of
options) shall become immediately fully vested and exercisable as of
the date of Executive's termination of employment.
2.6 MITIGATION. Except as otherwise specifically provided
herein, Executive shall not be required to mitigate damages or the
amount of any payment provided under this Agreement by seeking other
employment or otherwise, nor shall the amount of any payment
provided for under this Agreement be reduced by any compensation
earned by Executive as a result of employment by another employer or
by any retirement benefits received by Executive after the date of
the Covered Termination.
ARTICLE 3
LIMITATIONS AND CONDITIONS ON BENEFITS
3.1 RELEASE PRIOR TO PAYMENT OF BENEFITS. Upon the
occurrence of a Covered Termination, and prior to the payment of any
benefits under this Agreement on account of such Covered
Termination, Executive shall execute a release (the "Release") in
the form attached hereto and incorporated herein as Exhibit A or
Exhibit B, as applicable. Such Release shall specifically relate to
all of Executive's rights and claims in existence at the time of
such execution and shall confirm Executive's obligations under the
Company's standard form of proprietary information and inventions
agreement. It is understood that, as specified in the applicable
Release, Executive has a certain number of calendar days to consider
whether to execute such Release, and Executive may revoke such
Release within seven (7) calendar days after execution. In the
event Executive does not execute such Release within the applicable
period, or if Executive revokes such Release within the subsequent
seven (7) day period, no benefits shall be payable under this
Agreement, and this Agreement shall be null and void.
<PAGE>
3.2 TERMINATION OF BENEFITS. Benefits under this Agreement
shall terminate immediately if the Executive, at any time, violates
any proprietary information or confidentiality obligation to the
Company.
3.3 NON-DUPLICATION OF BENEFITS. Executive is not eligible
to receive benefits under this Agreement more than one time.
ARTICLE 4
PARACHUTE PAYMENTS
PARACHUTE PAYMENTS. If any payment or benefit Executive would
receive under this Plan, when combined with any other payment or
benefit Executive receives pursuant to the termination of
Executive's employment with the Company ("Payment"), would (i)
constitute a "parachute payment" within the meaning of Section 280G
of the Internal Revenue Code of 1986, as amended (the "Code"), and
(ii) but for this sentence, be subject to the excise tax imposed by
Section 4999 of the Code (the "Excise Tax"), then such Payment shall
be either (x) the full amount of such Payment or (y) such lesser
amount (with cash payments being reduced before stock option
compensation) as would result in no portion of the Payment being
subject to the Excise Tax, whichever of the foregoing amounts,
taking into account the applicable federal, state and local
employment taxes, income taxes, and the Excise Tax results in
Executive's receipt, on an after-tax basis, of the greater amount of
the Payment notwithstanding that all or some portion of the Payment
may be subject to the Excise Tax.
ARTICLE 5
DEFINITIONS
For purposes of the Agreement, the following terms are defined
as follows:
5.1 "BASE SALARY" means Executive's annual base salary as in
effect during the last regularly scheduled payroll period
immediately preceding the Covered Termination.
5.2 "BOARD" means the Board of Directors of the Company.
5.3 "CAUSE" means that, in the reasonable determination of
the Company or, in the case of the Chief Executive Officer, the
Board, Executive:
(A) has committed an act that materially injures the business
of the Company;
(B) has refused or failed to follow lawful and reasonable
directions of the Board or the appropriate individual to whom
Executive reports;
(C) has willfully or habitually neglected Executive's duties
for the Company; or
(D) has been convicted of a felony involving moral turpitude
that is likely to inflict or has inflicted material injury on the
business of the Company.
<PAGE>
Notwithstanding the foregoing, Cause shall not exist based on
conduct described in clause (b) or clause (c) unless the conduct
described in such clause has not been cured within fifteen (15) days
following Executive's receipt of written notice from the Company or
the Board, as the case may be, specifying the particulars of the
conduct constituting Cause.
5.4 "CHANGE IN CONTROL" means
(A) a sale of substantially all of the assets of the Company;
(B) a merger or consolidation in which the Company is not the
surviving corporation (other than a merger or consolidation in which
shareholders immediately before the merger or consolidation have,
immediately after the merger or consolidation, equal or greater
stock voting power);
(C) a reverse merger in which the Company is the surviving
corporation but the shares of the Company's common stock outstanding
immediately preceding the merger are converted by virtue of the
merger into other property, whether in the form of securities, cash
or otherwise (other than a reverse merger in which shareholders
immediately before the merger have, immediately after the merger,
greater stock voting power); or
(D) any transaction or series of related transactions in
which in excess of 50% of the Company's voting power is transferred.
5.5 "COMPANY" means CV Therapeutics, Inc. or, following a
Change in Control, the surviving entity resulting from such
transaction.
5.6 "CONSTRUCTIVE TERMINATION" means that Executive
voluntarily terminates employment within thirteen (13) months
following a Change in Control after any of the following are
undertaken without Executive's express written consent:
(A) the assignment to Executive of any duties or
responsibilities which results in a significant diminution in
Executive's function as in effect immediately prior to the effective
date of the Change in Control; provided, however, that a mere change
in Executive's title or reporting relationships shall not constitute
a Constructive Termination;
(B) a reduction by the Company in Executive's annual base
salary, as in effect on the effective date of the Change in Control
or as increased thereafter;
(C) any failure by the Company to continue in effect any
benefit plan or program, including fringe benefits, incentive plans
and plans with respect to the receipt of securities of the Company,
in which Executive is participating immediately prior to the
effective date of the Change in Control (hereinafter referred to as
"Benefit Plans"); or the taking of any action by the Company that
would adversely affect Executive's participation in or reduce
Executive's benefits under the Benefit Plans; provided, however,
that a "Constructive Termination" shall not exist under this
paragraph following a Change in Control if the Company offers a
range of benefit plans and programs which, taken as a whole, are
comparable to the Benefit Plans;
<PAGE>
(D) a relocation of Executive's business office to a location
more than twenty (20) miles from the location at which Executive
performs duties as of the effective date of the Change in Control,
except for required travel by Executive on the Company's business to
an extent substantially consistent with Executive's business travel
obligations prior to the Change in Control; provided, however, that
if Executive performs sales functions for the Company, a change of
sales territory shall not constitute a basis for Constructive
Termination so long as the Executive's business office is not
relocated as provided above;
(E) a material breach by the Company of any provision of this
Agreement; or
(F) any failure by the Company to obtain the assumption of
this Agreement by any successor or assign of the Company.
5.7 "COVERED TERMINATION" means an Involuntary Termination
Without Cause or a Constructive Termination occurring within
thirteen (13) months following the effective date of a Change in
Control.
5.8 "INVOLUNTARY TERMINATION WITHOUT CAUSE" means Executive's
dismissal or discharge other than for Cause. The termination of
Executive's employment as a result of Executive's death or
disability will not be deemed to be an Involuntary Termination
Without Cause.
ARTICLE 6
GENERAL PROVISIONS
6.1 EMPLOYMENT STATUS. This Agreement does not constitute a
contract of employment or impose upon Executive any obligation to
remain as an employee, or impose on the Company any obligation (i)
to retain Executive as an employee, (ii) to change the status of
Executive as an at-will employee, or (iii) to change the Company's
policies regarding termination of employment.
6.2 NOTICES. Any notices provided hereunder must be in
writing, and such notices or any other written communication shall
be deemed effective upon the earlier of personal delivery (including
personal delivery by facsimile) or the third day after mailing by
first class mail, to the Company at its primary office location and
to Executive at Executive's address as listed in the Company's
payroll records. Any payments made by the Company to Executive
under the terms of this Agreement shall be delivered to Executive
either in person or at the address as listed in the Company's
payroll records.
6.3 SEVERABILITY. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement
is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability will not affect any other provision
or any other jurisdiction, but this Agreement will be reformed,
construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provisions had never been contained herein.
<PAGE>
6.4 WAIVER. If either party should waive any breach of any
provisions of this Agreement, he or it shall not thereby be deemed
to have waived any preceding or succeeding breach of the same or any
other provision of this Agreement.
6.5 ARBITRATION. Unless otherwise prohibited by law or
specified below, all disputes, claims and causes of action, in law
or equity, arising from or relating to this Agreement or its
enforcement, performance, breach, or interpretation shall be
resolved solely and exclusively by final and binding arbitration
held in San Francisco County, California through Judicial
Arbitration & Mediation Services/Endispute ("JAMS") under the then
existing JAMS arbitration rules. However, nothing in this section
is intended to prevent either party from obtaining injunctive relief
in court to prevent irreparable harm pending the conclusion of any
such arbitration. Each party in any such arbitration shall be
responsible for its own attorneys' fees, costs and necessary
disbursement; provided, however, that in the event one party refuses
to arbitrate and the other party seeks to compel arbitration by
court order, if such other party prevails, it shall be entitled to
recover reasonable attorneys' fees, costs and necessary
disbursements. Pursuant to California Civil Code Section 1717, each
party warrants that it was represented by counsel in the negotiation
and execution of this Agreement, including the attorneys' fees
provision herein.
6.6 COMPLETE AGREEMENT. This Agreement, including Exhibit A
and Exhibit B, constitutes the entire agreement between Executive
and the Company and is the complete, final, and exclusive embodiment
of their agreement with regard to this subject matter, wholly
superseding all written and oral agreements with respect to cash
severance benefits and health benefits to Executive in the event of
employment termination other than any outstanding loans by the
Company to Executive. It is entered into without reliance on any
promise or representation other than those expressly contained herein.
6.7 AMENDMENT OR TERMINATION OF AGREEMENT. This Agreement
may be changed or terminated only upon the mutual written consent of
the Company and Executive. The written consent of the Company to a
change or termination of this Agreement must be signed by an
executive officer of the Company after such change or termination
has been approved by the Board.
6.8 COUNTERPARTS. This Agreement may be executed in separate
counterparts, any one of which need not contain signatures of more
than one party, but all of which taken together will constitute one
and the same Agreement.
6.9 HEADINGS. The headings of the Articles and Sections
hereof are inserted for convenience only and shall not be deemed to
constitute a part hereof nor to affect the meaning thereof.
6.10 SUCCESSORS AND ASSIGNS. This Agreement is intended to
bind and inure to the benefit of and be enforceable by Executive,
and the Company, and any surviving entity resulting from a Change in
Control and upon any other person who is a successor by merger,
acquisition, consolidation or otherwise to the business formerly
carried on by the Company, and their respective successors, assigns,
heirs, executors and administrators, without regard to whether or
not such person actively assumes any rights or duties hereunder;
<PAGE>
provided, however, that Executive may not assign any duties
hereunder and may not assign any rights hereunder without the
written consent of the Company, which consent shall not be withheld
unreasonably.
6.11 CHOICE OF LAW. All questions concerning the
construction, validity and interpretation of this Agreement will be
governed by the law of the State of California, without regard to
such state's conflict of laws rules.
6.12 NON-PUBLICATION. The parties mutually agree not to
disclose publicly the terms of this Agreement except to the extent
that disclosure is mandated by applicable law or to respective
advisors (e.g., attorneys, accountants).
6.13 CONSTRUCTION OF AGREEMENT. In the event of a conflict
between the text of the Agreement and any summary, description or
other information regarding the Agreement, the text of the Agreement
shall control.
IN WITNESS WHEREOF, the parties have executed this Agreement on
the Effective Date written above.
CV THERAPEUTICS, INC. BRENT K. BLACKBURN
By: /s/ LOUIS G. LANGE, M.D., PH.D. /s/ BRENT K. BLACKBURN
Name: Louis G. Lange, M.D., Ph.D.
Title: Chairman of the Board & Chief Executive Officer
Exhibit A: Release (Individual Termination)
Exhibit B: Release (Group Termination)
<PAGE>
EXHIBIT A
RELEASE
(INDIVIDUAL TERMINATION)
Certain capitalized terms used in this Release are defined in
the Executive Severance Benefits Agreement (the "Agreement") which I
have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.
I acknowledge that I have read and understand Section 1542 of
the California Civil Code which reads as follows: "A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT
WITH THE DEBTOR." I hereby expressly waive and relinquish all
rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any
claims I may have against the Company.
Except as otherwise set forth in this Release, I hereby
release, acquit and forever discharge the Company, its parents and
subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and
from any and all claims, liabilities, demands, causes of action,
costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise,
known and unknown, suspected and unsuspected, disclosed and
undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment
with the Company), arising out of or in any way related to
agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such
claims and demands directly or indirectly arising out of or in any
way connected with my employment with the Company or the termination
of that employment, including but not limited to, claims of
intentional and negligent infliction of emotional distress, any and
all tort claims for personal injury, claims or demands related to
salary, bonuses, commissions, stock, stock options, or any other
ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance pay, or any other form of disputed
compensation; claims pursuant to any federal, state or local law or
cause of action including, but not limited to, the federal Civil
Rights Act of 1964, as amended; the federal Age Discrimination in
Employment Act of 1967, as amended ("ADEA"); the federal Employee
Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; the California Fair
Employment and Housing Act, as amended; tort law; contract law;
statutory law; common law; wrongful discharge; discrimination;
fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that
nothing in this paragraph shall be construed in any way to release
the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or
applicable law.
<PAGE>
I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under ADEA. I also acknowledge that
the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything
of value to which I was already entitled. I further acknowledge
that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or
claims that may arise on or after the date I execute this Release;
(B) I have the right to consult with an attorney prior to executing
this Release; (C) I have twenty-one (21) days to consider this
Release (although I may choose to voluntarily execute this Release
earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; and (E) this Release
shall not be effective until the date upon which the revocation
period has expired, which shall be the eighth day after this Release
is executed by me.
BRENT K. BLACKBURN
Date:
<PAGE>
EXHIBIT B
RELEASE
(GROUP TERMINATION)
Certain capitalized terms used in this Release are defined in
the Executive Severance Benefits Agreement (the "Agreement") which I
have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.
I acknowledge that I have read and understand Section 1542 of
the California Civil Code which reads as follows: "A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT
WITH THE DEBTOR." I hereby expressly waive and relinquish all
rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any
claims I may have against the Company.
Except as otherwise set forth in this Release, I hereby
release, acquit and forever discharge the Company, its parents and
subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and
from any and all claims, liabilities, demands, causes of action,
costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise,
known and unknown, suspected and unsuspected, disclosed and
undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment
with the Company), arising out of or in any way related to
agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such
claims and demands directly or indirectly arising out of or in any
way connected with my employment with the Company or the termination
of that employment, including but not limited to, claims of
intentional and negligent infliction of emotional distress, any and
all tort claims for personal injury, claims or demands related to
salary, bonuses, commissions, stock, stock options, or any other
ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance pay, or any other form of disputed
compensation; claims pursuant to any federal, state or local law or
cause of action including, but not limited to, the federal Civil
Rights Act of 1964, as amended; the federal Age Discrimination in
Employment Act of 1967, as amended ("ADEA"); the federal Employee
Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; the California Fair
Employment and Housing Act, as amended; tort law; contract law;
statutory law; common law; wrongful discharge; discrimination;
fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that
nothing in this paragraph shall be construed in any way to release
the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or
applicable law.
<PAGE>
I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under ADEA. I also acknowledge that
the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything
of value to which I was already entitled. I further acknowledge
that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or
claims that may arise on or after the date I execute this Release;
(B) I have the right to consult with an attorney prior to executing
this Release; (C) I have forty-five (45) days to consider this
Release (although I may choose to voluntarily execute this Release
earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; (E) this Release shall
not be effective until the date upon which the revocation period has
expired, which shall be the eighth day after this Release is
executed by me; and (F) I have received with this Release a
detailed list of the job titles and ages of all employees who were
terminated in this group termination and the ages of all employees
of the Company in the same job classification or organizational unit
who were not terminated.
BRENT K. BLACKBURN
Date:
<PAGE>
EXECUTIVE
SEVERANCE BENEFITS AGREEMENT
This EXECUTIVE SEVERANCE BENEFITS AGREEMENT (the "AGREEMENT")
is entered into this 2nd day of February, 1999 (the "Effective
Date"), between RICHARD M. LAWN ("EXECUTIVE") and CV Therapeutics,
Inc. (the "COMPANY"). This Agreement is intended to provide
Executive with the compensation and benefits described herein upon
the occurrence of specific events. Certain capitalized terms used
in this Agreement are defined in Article 5.
The Company and Executive hereby agree as follows:
ARTICLE 1
SCOPE OF AND CONSIDERATION FOR THIS AGREEMENT
1.1 Executive is currently employed by the Company.
1.2 The Company and Executive wish to set forth the
compensation and benefits which Executive shall be entitled to
receive in the event Executive's employment with the Company is
terminated under the circumstances described herein following a
Change in Control.
1.3 The duties and obligations of the Company to Executive
under this Agreement shall be in consideration for Executive's past
services to the Company, Executive's continued employment with the
Company, and Executive's execution of a release in accordance with
Section 3.1.
1.4 This Agreement shall supersede any other agreement
relating to cash severance benefits and health benefits in the event
of Executive's severance from employment with the Company following
a Change in Control.
ARTICLE 2
SEVERANCE BENEFITS
2.1 SEVERANCE BENEFITS. If Executive's employment terminates
due to an Involuntary Termination Without Cause or a Constructive
Termination within thirteen (13) months following the effective date
of a Change in Control, such termination of employment will be
deemed a Covered Termination. A Covered Termination entitles
Executive to receive the following benefits set forth in Sections
2.2, 2.3, 2.4, and 2.5.
2.2 SALARY CONTINUATION. Executive shall continue to receive
Base Salary for eighteen (18) months following a Covered
Termination. Such amount shall be paid in regular installments on
the normal payroll dates of the Company and shall be subject to all
required tax withholding.
<PAGE>
2.3 BONUS. The Company shall pay to Executive an amount
equal to one hundred and fifty percent (150%) of the annual bonus
paid to the Executive in the year immediately preceding the
effective date of the Change in Control. Such amount shall be paid
in regular installments on the normal payroll dates of the Company
and shall be subject to all required tax withholding.
2.4 HEALTH BENEFITS. Provided that Executive elects
continued coverage under federal COBRA law, the Company shall pay
the premiums of Executive's group health insurance coverage,
including coverage for Executive's eligible dependents, for a
maximum period of eighteen (18) months following a Covered
Termination; provided, however, that the Company shall pay premiums
for Executive's eligible dependents only for coverage for which
those eligible dependents were enrolled immediately prior to the
Covered Termination. No premium payments will be made following the
effective date of Executive's coverage by a health insurance plan of
a subsequent employer. For the balance of the period that Executive
is entitled to coverage under federal COBRA law, Executive shall be
entitled to maintain such coverage at Executive's own expense.
2.5 OPTION ACCELERATION. If Executive's employment with the
Company terminates due to a Covered Termination, then all options of
Executive to purchase the Company's common stock (or the stock of a
successor to the Company by reason of assumption or substitution of
options) shall become immediately fully vested and exercisable as of
the date of Executive's termination of employment.
2.6 MITIGATION. Except as otherwise specifically provided
herein, Executive shall not be required to mitigate damages or the
amount of any payment provided under this Agreement by seeking other
employment or otherwise, nor shall the amount of any payment
provided for under this Agreement be reduced by any compensation
earned by Executive as a result of employment by another employer or
by any retirement benefits received by Executive after the date of
the Covered Termination.
ARTICLE 3
LIMITATIONS AND CONDITIONS ON BENEFITS
3.1 RELEASE PRIOR TO PAYMENT OF BENEFITS. Upon the
occurrence of a Covered Termination, and prior to the payment of any
benefits under this Agreement on account of such Covered
Termination, Executive shall execute a release (the "Release") in
the form attached hereto and incorporated herein as Exhibit A or
Exhibit B, as applicable. Such Release shall specifically relate to
all of Executive's rights and claims in existence at the time of
such execution and shall confirm Executive's obligations under the
Company's standard form of proprietary information and inventions
agreement. It is understood that, as specified in the applicable
Release, Executive has a certain number of calendar days to consider
whether to execute such Release, and Executive may revoke such
Release within seven (7) calendar days after execution. In the
event Executive does not execute such Release within the applicable
period, or if Executive revokes such Release within the subsequent
seven (7) day period, no benefits shall be payable under this
Agreement, and this Agreement shall be null and void.
<PAGE>
3.2 TERMINATION OF BENEFITS. Benefits under this Agreement
shall terminate immediately if the Executive, at any time, violates
any proprietary information or confidentiality obligation to the
Company.
3.3 NON-DUPLICATION OF BENEFITS. Executive is not eligible
to receive benefits under this Agreement more than one time.
ARTICLE 4
PARACHUTE PAYMENTS
PARACHUTE PAYMENTS. If any payment or benefit Executive would
receive under this Plan, when combined with any other payment or
benefit Executive receives pursuant to the termination of
Executive's employment with the Company ("Payment"), would (i)
constitute a "parachute payment" within the meaning of Section 280G
of the Internal Revenue Code of 1986, as amended (the "Code"), and
(ii) but for this sentence, be subject to the excise tax imposed by
Section 4999 of the Code (the "Excise Tax"), then such Payment shall
be either (x) the full amount of such Payment or (y) such lesser
amount (with cash payments being reduced before stock option
compensation) as would result in no portion of the Payment being
subject to the Excise Tax, whichever of the foregoing amounts,
taking into account the applicable federal, state and local
employment taxes, income taxes, and the Excise Tax results in
Executive's receipt, on an after-tax basis, of the greater amount of
the Payment notwithstanding that all or some portion of the Payment
may be subject to the Excise Tax.
ARTICLE 5
DEFINITIONS
For purposes of the Agreement, the following terms are defined
as follows:
5.1 "BASE SALARY" means Executive's annual base salary as in
effect during the last regularly scheduled payroll period
immediately preceding the Covered Termination.
5.2 "BOARD" means the Board of Directors of the Company.
5.3 "CAUSE" means that, in the reasonable determination of
the Company or, in the case of the Chief Executive Officer, the
Board, Executive:
(A) has committed an act that materially injures the business
of the Company;
(B) has refused or failed to follow lawful and reasonable
directions of the Board or the appropriate individual to whom
Executive reports;
(C) has willfully or habitually neglected Executive's duties
for the Company; or
(D) has been convicted of a felony involving moral turpitude
that is likely to inflict or has inflicted material injury on the
business of the Company.
<PAGE>
Notwithstanding the foregoing, Cause shall not exist based on
conduct described in clause (b) or clause (c) unless the conduct
described in such clause has not been cured within fifteen (15) days
following Executive's receipt of written notice from the Company or
the Board, as the case may be, specifying the particulars of the
conduct constituting Cause.
5.4 "CHANGE IN CONTROL" means
(A) a sale of substantially all of the assets of the Company;
(B) a merger or consolidation in which the Company is not the
surviving corporation (other than a merger or consolidation in which
shareholders immediately before the merger or consolidation have,
immediately after the merger or consolidation, equal or greater
stock voting power);
(C) a reverse merger in which the Company is the surviving
corporation but the shares of the Company's common stock outstanding
immediately preceding the merger are converted by virtue of the
merger into other property, whether in the form of securities, cash
or otherwise (other than a reverse merger in which shareholders
immediately before the merger have, immediately after the merger,
greater stock voting power); or
(D) any transaction or series of related transactions in
which in excess of 50% of the Company's voting power is transferred.
5.5 "COMPANY" means CV Therapeutics, Inc. or, following a
Change in Control, the surviving entity resulting from such
transaction.
5.6 "CONSTRUCTIVE TERMINATION" means that Executive
voluntarily terminates employment within thirteen (13) months
following a Change in Control after any of the following are
undertaken without Executive's express written consent:
(A) the assignment to Executive of any duties or
responsibilities which results in a significant diminution in
Executive's function as in effect immediately prior to the effective
date of the Change in Control; provided, however, that a mere change
in Executive's title or reporting relationships shall not constitute
a Constructive Termination;
(B) a reduction by the Company in Executive's annual base
salary, as in effect on the effective date of the Change in Control
or as increased thereafter;
(C) any failure by the Company to continue in effect any
benefit plan or program, including fringe benefits, incentive plans
and plans with respect to the receipt of securities of the Company,
in which Executive is participating immediately prior to the
effective date of the Change in Control (hereinafter referred to as
"Benefit Plans"); or the taking of any action by the Company that
would adversely affect Executive's participation in or reduce
Executive's benefits under the Benefit Plans; provided, however,
that a "Constructive Termination" shall not exist under this
paragraph following a Change in Control if the Company offers a
range of benefit plans and programs which, taken as a whole, are
comparable to the Benefit Plans;
<PAGE>
(D) a relocation of Executive's business office to a location
more than twenty (20) miles from the location at which Executive
performs duties as of the effective date of the Change in Control,
except for required travel by Executive on the Company's business to
an extent substantially consistent with Executive's business travel
obligations prior to the Change in Control; provided, however, that
if Executive performs sales functions for the Company, a change of
sales territory shall not constitute a basis for Constructive
Termination so long as the Executive's business office is not
relocated as provided above;
(E) a material breach by the Company of any provision of this
Agreement; or
(F) any failure by the Company to obtain the assumption of
this Agreement by any successor or assign of the Company.
5.7 "COVERED TERMINATION" means an Involuntary Termination
Without Cause or a Constructive Termination occurring within
thirteen (13) months following the effective date of a Change in
Control.
5.8 "INVOLUNTARY TERMINATION WITHOUT CAUSE" means Executive's
dismissal or discharge other than for Cause. The termination of
Executive's employment as a result of Executive's death or
disability will not be deemed to be an Involuntary Termination
Without Cause.
ARTICLE 6
GENERAL PROVISIONS
6.1 EMPLOYMENT STATUS. This Agreement does not constitute a
contract of employment or impose upon Executive any obligation to
remain as an employee, or impose on the Company any obligation (i)
to retain Executive as an employee, (ii) to change the status of
Executive as an at-will employee, or (iii) to change the Company's
policies regarding termination of employment.
6.2 NOTICES. Any notices provided hereunder must be in
writing, and such notices or any other written communication shall
be deemed effective upon the earlier of personal delivery (including
personal delivery by facsimile) or the third day after mailing by
first class mail, to the Company at its primary office location and
to Executive at Executive's address as listed in the Company's
payroll records. Any payments made by the Company to Executive
under the terms of this Agreement shall be delivered to Executive
either in person or at the address as listed in the Company's
payroll records.
6.3 SEVERABILITY. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement
is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability will not affect any other provision
or any other jurisdiction, but this Agreement will be reformed,
construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provisions had never been contained herein.
<PAGE>
6.4 WAIVER. If either party should waive any breach of any
provisions of this Agreement, he or it shall not thereby be deemed
to have waived any preceding or succeeding breach of the same or any
other provision of this Agreement.
6.5 ARBITRATION. Unless otherwise prohibited by law or
specified below, all disputes, claims and causes of action, in law
or equity, arising from or relating to this Agreement or its
enforcement, performance, breach, or interpretation shall be
resolved solely and exclusively by final and binding arbitration
held in San Francisco County, California through Judicial
Arbitration & Mediation Services/Endispute ("JAMS") under the then
existing JAMS arbitration rules. However, nothing in this section
is intended to prevent either party from obtaining injunctive relief
in court to prevent irreparable harm pending the conclusion of any
such arbitration. Each party in any such arbitration shall be
responsible for its own attorneys' fees, costs and necessary
disbursement; provided, however, that in the event one party refuses
to arbitrate and the other party seeks to compel arbitration by
court order, if such other party prevails, it shall be entitled to
recover reasonable attorneys' fees, costs and necessary
disbursements. Pursuant to California Civil Code Section 1717, each
party warrants that it was represented by counsel in the negotiation
and execution of this Agreement, including the attorneys' fees
provision herein.
6.6 COMPLETE AGREEMENT. This Agreement, including Exhibit A
and Exhibit B, constitutes the entire agreement between Executive
and the Company and is the complete, final, and exclusive embodiment
of their agreement with regard to this subject matter, wholly
superseding all written and oral agreements with respect to cash
severance benefits and health benefits to Executive in the event of
employment termination other than any outstanding loans by the
Company to Executive. It is entered into without reliance on any
promise or representation other than those expressly contained herein.
6.7 AMENDMENT OR TERMINATION OF AGREEMENT. This Agreement
may be changed or terminated only upon the mutual written consent of
the Company and Executive. The written consent of the Company to a
change or termination of this Agreement must be signed by an
executive officer of the Company after such change or termination
has been approved by the Board.
6.8 COUNTERPARTS. This Agreement may be executed in separate
counterparts, any one of which need not contain signatures of more
than one party, but all of which taken together will constitute one
and the same Agreement.
6.9 HEADINGS. The headings of the Articles and Sections
hereof are inserted for convenience only and shall not be deemed to
constitute a part hereof nor to affect the meaning thereof.
6.10 SUCCESSORS AND ASSIGNS. This Agreement is intended to
bind and inure to the benefit of and be enforceable by Executive,
and the Company, and any surviving entity resulting from a Change in
Control and upon any other person who is a successor by merger,
acquisition, consolidation or otherwise to the business formerly
carried on by the Company, and their respective successors, assigns,
heirs, executors and administrators, without regard to whether or
not such person actively assumes any rights or duties hereunder;
<PAGE>
provided, however, that Executive may not assign any duties
hereunder and may not assign any rights hereunder without the
written consent of the Company, which consent shall not be withheld
unreasonably.
6.11 CHOICE OF LAW. All questions concerning the
construction, validity and interpretation of this Agreement will be
governed by the law of the State of California, without regard to
such state's conflict of laws rules.
6.12 NON-PUBLICATION. The parties mutually agree not to
disclose publicly the terms of this Agreement except to the extent
that disclosure is mandated by applicable law or to respective
advisors (e.g., attorneys, accountants).
6.13 CONSTRUCTION OF AGREEMENT. In the event of a conflict
between the text of the Agreement and any summary, description or
other information regarding the Agreement, the text of the Agreement
shall control.
IN WITNESS WHEREOF, the parties have executed this Agreement on
the Effective Date written above.
CV THERAPEUTICS, INC. RICHARD M. LAWN
By: /s/ LOUIS G. LANGE, M.D., PH.D. /s/ RICHARD M. LAWN
Name: Louis G. Lange, M.D., Ph.D.
Title: Chairman of the Board & Chief Executive Officer
Exhibit A: Release (Individual Termination)
Exhibit B: Release (Group Termination)
<PAGE>
EXHIBIT A
RELEASE
(INDIVIDUAL TERMINATION)
Certain capitalized terms used in this Release are defined in
the Executive Severance Benefits Agreement (the "Agreement") which I
have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.
I acknowledge that I have read and understand Section 1542 of
the California Civil Code which reads as follows: "A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT
WITH THE DEBTOR." I hereby expressly waive and relinquish all
rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any
claims I may have against the Company.
Except as otherwise set forth in this Release, I hereby
release, acquit and forever discharge the Company, its parents and
subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and
from any and all claims, liabilities, demands, causes of action,
costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise,
known and unknown, suspected and unsuspected, disclosed and
undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment
with the Company), arising out of or in any way related to
agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such
claims and demands directly or indirectly arising out of or in any
way connected with my employment with the Company or the termination
of that employment, including but not limited to, claims of
intentional and negligent infliction of emotional distress, any and
all tort claims for personal injury, claims or demands related to
salary, bonuses, commissions, stock, stock options, or any other
ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance pay, or any other form of disputed
compensation; claims pursuant to any federal, state or local law or
cause of action including, but not limited to, the federal Civil
Rights Act of 1964, as amended; the federal Age Discrimination in
Employment Act of 1967, as amended ("ADEA"); the federal Employee
Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; the California Fair
Employment and Housing Act, as amended; tort law; contract law;
statutory law; common law; wrongful discharge; discrimination;
fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that
nothing in this paragraph shall be construed in any way to release
the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or
applicable law.
<PAGE>
I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under ADEA. I also acknowledge that
the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything
of value to which I was already entitled. I further acknowledge
that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or
claims that may arise on or after the date I execute this Release;
(B) I have the right to consult with an attorney prior to executing
this Release; (C) I have twenty-one (21) days to consider this
Release (although I may choose to voluntarily execute this Release
earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; and (E) this Release
shall not be effective until the date upon which the revocation
period has expired, which shall be the eighth day after this Release
is executed by me.
RICHARD M. LAWN
Date:
<PAGE>
EXHIBIT B
RELEASE
(GROUP TERMINATION)
Certain capitalized terms used in this Release are defined in
the Executive Severance Benefits Agreement (the "Agreement") which I
have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.
I acknowledge that I have read and understand Section 1542 of
the California Civil Code which reads as follows: "A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT
WITH THE DEBTOR." I hereby expressly waive and relinquish all
rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any
claims I may have against the Company.
Except as otherwise set forth in this Release, I hereby
release, acquit and forever discharge the Company, its parents and
subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and
from any and all claims, liabilities, demands, causes of action,
costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise,
known and unknown, suspected and unsuspected, disclosed and
undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment
with the Company), arising out of or in any way related to
agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such
claims and demands directly or indirectly arising out of or in any
way connected with my employment with the Company or the termination
of that employment, including but not limited to, claims of
intentional and negligent infliction of emotional distress, any and
all tort claims for personal injury, claims or demands related to
salary, bonuses, commissions, stock, stock options, or any other
ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance pay, or any other form of disputed
compensation; claims pursuant to any federal, state or local law or
cause of action including, but not limited to, the federal Civil
Rights Act of 1964, as amended; the federal Age Discrimination in
Employment Act of 1967, as amended ("ADEA"); the federal Employee
Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; the California Fair
Employment and Housing Act, as amended; tort law; contract law;
statutory law; common law; wrongful discharge; discrimination;
fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that
nothing in this paragraph shall be construed in any way to release
the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or
applicable law.
<PAGE>
I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under ADEA. I also acknowledge that
the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything
of value to which I was already entitled. I further acknowledge
that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or
claims that may arise on or after the date I execute this Release;
(B) I have the right to consult with an attorney prior to executing
this Release; (C) I have forty-five (45) days to consider this
Release (although I may choose to voluntarily execute this Release
earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; (E) this Release shall
not be effective until the date upon which the revocation period has
expired, which shall be the eighth day after this Release is
executed by me; and (F) I have received with this Release a
detailed list of the job titles and ages of all employees who were
terminated in this group termination and the ages of all employees
of the Company in the same job classification or organizational unit
who were not terminated.
RICHARD M. LAWN
Date:
<PAGE>
EXECUTIVE
SEVERANCE BENEFITS AGREEMENT
This EXECUTIVE SEVERANCE BENEFITS AGREEMENT (the "AGREEMENT")
is entered into this 2nd day of February, 1999 (the "Effective
Date"), between LUIZ BELARDINELLI ("EXECUTIVE") and CV Therapeutics,
Inc. (the "COMPANY"). This Agreement is intended to provide
Executive with the compensation and benefits described herein upon
the occurrence of specific events. Certain capitalized terms used
in this Agreement are defined in Article 5.
The Company and Executive hereby agree as follows:
ARTICLE 1
SCOPE OF AND CONSIDERATION FOR THIS AGREEMENT
1.1 Executive is currently employed by the Company.
1.2 The Company and Executive wish to set forth the
compensation and benefits which Executive shall be entitled to
receive in the event Executive's employment with the Company is
terminated under the circumstances described herein following a
Change in Control.
1.3 The duties and obligations of the Company to Executive
under this Agreement shall be in consideration for Executive's past
services to the Company, Executive's continued employment with the
Company, and Executive's execution of a release in accordance with
Section 3.1.
1.4 This Agreement shall supersede any other agreement
relating to cash severance benefits and health benefits in the event
of Executive's severance from employment with the Company following
a Change in Control.
ARTICLE 2
SEVERANCE BENEFITS
2.1 SEVERANCE BENEFITS. If Executive's employment terminates
due to an Involuntary Termination Without Cause or a Constructive
Termination within thirteen (13) months following the effective date
of a Change in Control, such termination of employment will be
deemed a Covered Termination. A Covered Termination entitles
Executive to receive the following benefits set forth in Sections
2.2, 2.3, 2.4, and 2.5.
2.2 SALARY CONTINUATION. Executive shall continue to receive
Base Salary for eighteen (18) months following a Covered
Termination. Such amount shall be paid in regular installments on
the normal payroll dates of the Company and shall be subject to all
required tax withholding.
<PAGE>
2.3 BONUS. The Company shall pay to Executive an amount
equal to one hundred and fifty percent (150%) of the annual bonus
paid to the Executive in the year immediately preceding the
effective date of the Change in Control. Such amount shall be paid
in regular installments on the normal payroll dates of the Company
and shall be subject to all required tax withholding.
2.4 HEALTH BENEFITS. Provided that Executive elects
continued coverage under federal COBRA law, the Company shall pay
the premiums of Executive's group health insurance coverage,
including coverage for Executive's eligible dependents, for a
maximum period of eighteen (18) months following a Covered
Termination; provided, however, that the Company shall pay premiums
for Executive's eligible dependents only for coverage for which
those eligible dependents were enrolled immediately prior to the
Covered Termination. No premium payments will be made following the
effective date of Executive's coverage by a health insurance plan of
a subsequent employer. For the balance of the period that Executive
is entitled to coverage under federal COBRA law, Executive shall be
entitled to maintain such coverage at Executive's own expense.
2.5 OPTION ACCELERATION. If Executive's employment with the
Company terminates due to a Covered Termination, then all options of
Executive to purchase the Company's common stock (or the stock of a
successor to the Company by reason of assumption or substitution of
options) shall become immediately fully vested and exercisable as of
the date of Executive's termination of employment.
2.6 MITIGATION. Except as otherwise specifically provided
herein, Executive shall not be required to mitigate damages or the
amount of any payment provided under this Agreement by seeking other
employment or otherwise, nor shall the amount of any payment
provided for under this Agreement be reduced by any compensation
earned by Executive as a result of employment by another employer or
by any retirement benefits received by Executive after the date of
the Covered Termination.
ARTICLE 3
LIMITATIONS AND CONDITIONS ON BENEFITS
3.1 RELEASE PRIOR TO PAYMENT OF BENEFITS. Upon the
occurrence of a Covered Termination, and prior to the payment of any
benefits under this Agreement on account of such Covered
Termination, Executive shall execute a release (the "Release") in
the form attached hereto and incorporated herein as Exhibit A or
Exhibit B, as applicable. Such Release shall specifically relate to
all of Executive's rights and claims in existence at the time of
such execution and shall confirm Executive's obligations under the
Company's standard form of proprietary information and inventions
agreement. It is understood that, as specified in the applicable
Release, Executive has a certain number of calendar days to consider
whether to execute such Release, and Executive may revoke such
Release within seven (7) calendar days after execution. In the
event Executive does not execute such Release within the applicable
period, or if Executive revokes such Release within the subsequent
seven (7) day period, no benefits shall be payable under this
Agreement, and this Agreement shall be null and void.
<PAGE>
3.2 TERMINATION OF BENEFITS. Benefits under this Agreement
shall terminate immediately if the Executive, at any time, violates
any proprietary information or confidentiality obligation to the
Company.
3.3 NON-DUPLICATION OF BENEFITS. Executive is not eligible
to receive benefits under this Agreement more than one time.
ARTICLE 4
PARACHUTE PAYMENTS
PARACHUTE PAYMENTS. If any payment or benefit Executive would
receive under this Plan, when combined with any other payment or
benefit Executive receives pursuant to the termination of
Executive's employment with the Company ("Payment"), would (i)
constitute a "parachute payment" within the meaning of Section 280G
of the Internal Revenue Code of 1986, as amended (the "Code"), and
(ii) but for this sentence, be subject to the excise tax imposed by
Section 4999 of the Code (the "Excise Tax"), then such Payment shall
be either (x) the full amount of such Payment or (y) such lesser
amount (with cash payments being reduced before stock option
compensation) as would result in no portion of the Payment being
subject to the Excise Tax, whichever of the foregoing amounts,
taking into account the applicable federal, state and local
employment taxes, income taxes, and the Excise Tax results in
Executive's receipt, on an after-tax basis, of the greater amount of
the Payment notwithstanding that all or some portion of the Payment
may be subject to the Excise Tax.
ARTICLE 5
DEFINITIONS
For purposes of the Agreement, the following terms are defined
as follows:
5.1 "BASE SALARY" means Executive's annual base salary as in
effect during the last regularly scheduled payroll period
immediately preceding the Covered Termination.
5.2 "BOARD" means the Board of Directors of the Company.
5.3 "CAUSE" means that, in the reasonable determination of
the Company or, in the case of the Chief Executive Officer, the
Board, Executive:
(A) has committed an act that materially injures the business
of the Company;
(B) has refused or failed to follow lawful and reasonable
directions of the Board or the appropriate individual to whom
Executive reports;
(C) has willfully or habitually neglected Executive's duties
for the Company; or
(D) has been convicted of a felony involving moral turpitude
that is likely to inflict or has inflicted material injury on the
business of the Company.
<PAGE>
Notwithstanding the foregoing, Cause shall not exist based on
conduct described in clause (b) or clause (c) unless the conduct
described in such clause has not been cured within fifteen (15) days
following Executive's receipt of written notice from the Company or
the Board, as the case may be, specifying the particulars of the
conduct constituting Cause.
5.4 "CHANGE IN CONTROL" means
(A) a sale of substantially all of the assets of the Company;
(B) a merger or consolidation in which the Company is not the
surviving corporation (other than a merger or consolidation in which
shareholders immediately before the merger or consolidation have,
immediately after the merger or consolidation, equal or greater
stock voting power);
(C) a reverse merger in which the Company is the surviving
corporation but the shares of the Company's common stock outstanding
immediately preceding the merger are converted by virtue of the
merger into other property, whether in the form of securities, cash
or otherwise (other than a reverse merger in which shareholders
immediately before the merger have, immediately after the merger,
greater stock voting power); or
(D) any transaction or series of related transactions in
which in excess of 50% of the Company's voting power is transferred.
5.5 "COMPANY" means CV Therapeutics, Inc. or, following a
Change in Control, the surviving entity resulting from such
transaction.
5.6 "CONSTRUCTIVE TERMINATION" means that Executive
voluntarily terminates employment within thirteen (13) months
following a Change in Control after any of the following are
undertaken without Executive's express written consent:
(A) the assignment to Executive of any duties or
responsibilities which results in a significant diminution in
Executive's function as in effect immediately prior to the effective
date of the Change in Control; provided, however, that a mere change
in Executive's title or reporting relationships shall not constitute
a Constructive Termination;
(B) a reduction by the Company in Executive's annual base
salary, as in effect on the effective date of the Change in Control
or as increased thereafter;
(C) any failure by the Company to continue in effect any
benefit plan or program, including fringe benefits, incentive plans
and plans with respect to the receipt of securities of the Company,
in which Executive is participating immediately prior to the
effective date of the Change in Control (hereinafter referred to as
"Benefit Plans"); or the taking of any action by the Company that
would adversely affect Executive's participation in or reduce
Executive's benefits under the Benefit Plans; provided, however,
that a "Constructive Termination" shall not exist under this
paragraph following a Change in Control if the Company offers a
range of benefit plans and programs which, taken as a whole, are
comparable to the Benefit Plans;
<PAGE>
(D) a relocation of Executive's business office to a location
more than twenty (20) miles from the location at which Executive
performs duties as of the effective date of the Change in Control,
except for required travel by Executive on the Company's business to
an extent substantially consistent with Executive's business travel
obligations prior to the Change in Control; provided, however, that
if Executive performs sales functions for the Company, a change of
sales territory shall not constitute a basis for Constructive
Termination so long as the Executive's business office is not
relocated as provided above;
(E) a material breach by the Company of any provision of this
Agreement; or
(F) any failure by the Company to obtain the assumption of
this Agreement by any successor or assign of the Company.
5.7 "COVERED TERMINATION" means an Involuntary Termination
Without Cause or a Constructive Termination occurring within
thirteen (13) months following the effective date of a Change in
Control.
5.8 "INVOLUNTARY TERMINATION WITHOUT CAUSE" means Executive's
dismissal or discharge other than for Cause. The termination of
Executive's employment as a result of Executive's death or
disability will not be deemed to be an Involuntary Termination
Without Cause.
ARTICLE 6
GENERAL PROVISIONS
6.1 EMPLOYMENT STATUS. This Agreement does not constitute a
contract of employment or impose upon Executive any obligation to
remain as an employee, or impose on the Company any obligation (i)
to retain Executive as an employee, (ii) to change the status of
Executive as an at-will employee, or (iii) to change the Company's
policies regarding termination of employment.
6.2 NOTICES. Any notices provided hereunder must be in
writing, and such notices or any other written communication shall
be deemed effective upon the earlier of personal delivery (including
personal delivery by facsimile) or the third day after mailing by
first class mail, to the Company at its primary office location and
to Executive at Executive's address as listed in the Company's
payroll records. Any payments made by the Company to Executive
under the terms of this Agreement shall be delivered to Executive
either in person or at the address as listed in the Company's
payroll records.
6.3 SEVERABILITY. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement
is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability will not affect any other provision
or any other jurisdiction, but this Agreement will be reformed,
construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provisions had never been contained herein.
<PAGE>
6.4 WAIVER. If either party should waive any breach of any
provisions of this Agreement, he or it shall not thereby be deemed
to have waived any preceding or succeeding breach of the same or any
other provision of this Agreement.
6.5 ARBITRATION. Unless otherwise prohibited by law or
specified below, all disputes, claims and causes of action, in law
or equity, arising from or relating to this Agreement or its
enforcement, performance, breach, or interpretation shall be
resolved solely and exclusively by final and binding arbitration
held in San Francisco County, California through Judicial
Arbitration & Mediation Services/Endispute ("JAMS") under the then
existing JAMS arbitration rules. However, nothing in this section
is intended to prevent either party from obtaining injunctive relief
in court to prevent irreparable harm pending the conclusion of any
such arbitration. Each party in any such arbitration shall be
responsible for its own attorneys' fees, costs and necessary
disbursement; provided, however, that in the event one party refuses
to arbitrate and the other party seeks to compel arbitration by
court order, if such other party prevails, it shall be entitled to
recover reasonable attorneys' fees, costs and necessary
disbursements. Pursuant to California Civil Code Section 1717, each
party warrants that it was represented by counsel in the negotiation
and execution of this Agreement, including the attorneys' fees
provision herein.
6.6 COMPLETE AGREEMENT. This Agreement, including Exhibit A
and Exhibit B, constitutes the entire agreement between Executive
and the Company and is the complete, final, and exclusive embodiment
of their agreement with regard to this subject matter, wholly
superseding all written and oral agreements with respect to cash
severance benefits and health benefits to Executive in the event of
employment termination other than any outstanding loans by the
Company to Executive. It is entered into without reliance on any
promise or representation other than those expressly contained herein.
6.7 AMENDMENT OR TERMINATION OF AGREEMENT. This Agreement
may be changed or terminated only upon the mutual written consent of
the Company and Executive. The written consent of the Company to a
change or termination of this Agreement must be signed by an
executive officer of the Company after such change or termination
has been approved by the Board.
6.8 COUNTERPARTS. This Agreement may be executed in separate
counterparts, any one of which need not contain signatures of more
than one party, but all of which taken together will constitute one
and the same Agreement.
6.9 HEADINGS. The headings of the Articles and Sections
hereof are inserted for convenience only and shall not be deemed to
constitute a part hereof nor to affect the meaning thereof.
6.10 SUCCESSORS AND ASSIGNS. This Agreement is intended to
bind and inure to the benefit of and be enforceable by Executive,
and the Company, and any surviving entity resulting from a Change in
Control and upon any other person who is a successor by merger,
acquisition, consolidation or otherwise to the business formerly
carried on by the Company, and their respective successors, assigns,
heirs, executors and administrators, without regard to whether or
not such person actively assumes any rights or duties hereunder;
<PAGE>
provided, however, that Executive may not assign any duties
hereunder and may not assign any rights hereunder without the
written consent of the Company, which consent shall not be withheld
unreasonably.
6.11 CHOICE OF LAW. All questions concerning the
construction, validity and interpretation of this Agreement will be
governed by the law of the State of California, without regard to
such state's conflict of laws rules.
6.12 NON-PUBLICATION. The parties mutually agree not to
disclose publicly the terms of this Agreement except to the extent
that disclosure is mandated by applicable law or to respective
advisors (e.g., attorneys, accountants).
6.13 CONSTRUCTION OF AGREEMENT. In the event of a conflict
between the text of the Agreement and any summary, description or
other information regarding the Agreement, the text of the Agreement
shall control.
IN WITNESS WHEREOF, the parties have executed this Agreement on
the Effective Date written above.
CV THERAPEUTICS, INC. LUIZ BELARDINELLI
By: /s/ LOUIS G. LANGE, M.D., PH.D. /s/ LUIZ BELARDINELLI
Name: Louis G. Lange, M.D., Ph.D.
Title: Chairman of the Board & Chief Executive Officer
Exhibit A: Release (Individual Termination)
Exhibit B: Release (Group Termination)
<PAGE>
EXHIBIT A
RELEASE
(INDIVIDUAL TERMINATION)
Certain capitalized terms used in this Release are defined in
the Executive Severance Benefits Agreement (the "Agreement") which I
have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.
I acknowledge that I have read and understand Section 1542 of
the California Civil Code which reads as follows: "A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT
WITH THE DEBTOR." I hereby expressly waive and relinquish all
rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any
claims I may have against the Company.
Except as otherwise set forth in this Release, I hereby
release, acquit and forever discharge the Company, its parents and
subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and
from any and all claims, liabilities, demands, causes of action,
costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise,
known and unknown, suspected and unsuspected, disclosed and
undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment
with the Company), arising out of or in any way related to
agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such
claims and demands directly or indirectly arising out of or in any
way connected with my employment with the Company or the termination
of that employment, including but not limited to, claims of
intentional and negligent infliction of emotional distress, any and
all tort claims for personal injury, claims or demands related to
salary, bonuses, commissions, stock, stock options, or any other
ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance pay, or any other form of disputed
compensation; claims pursuant to any federal, state or local law or
cause of action including, but not limited to, the federal Civil
Rights Act of 1964, as amended; the federal Age Discrimination in
Employment Act of 1967, as amended ("ADEA"); the federal Employee
Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; the California Fair
Employment and Housing Act, as amended; tort law; contract law;
statutory law; common law; wrongful discharge; discrimination;
fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that
nothing in this paragraph shall be construed in any way to release
the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or
applicable law.
<PAGE>
I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under ADEA. I also acknowledge that
the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything
of value to which I was already entitled. I further acknowledge
that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or
claims that may arise on or after the date I execute this Release;
(B) I have the right to consult with an attorney prior to executing
this Release; (C) I have twenty-one (21) days to consider this
Release (although I may choose to voluntarily execute this Release
earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; and (E) this Release
shall not be effective until the date upon which the revocation
period has expired, which shall be the eighth day after this Release
is executed by me.
LUIZ BELARDINELLI
Date:
<PAGE>
EXHIBIT B
RELEASE
(GROUP TERMINATION)
Certain capitalized terms used in this Release are defined in
the Executive Severance Benefits Agreement (the "Agreement") which I
have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.
I acknowledge that I have read and understand Section 1542 of
the California Civil Code which reads as follows: "A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT
WITH THE DEBTOR." I hereby expressly waive and relinquish all
rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any
claims I may have against the Company.
Except as otherwise set forth in this Release, I hereby
release, acquit and forever discharge the Company, its parents and
subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and
from any and all claims, liabilities, demands, causes of action,
costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise,
known and unknown, suspected and unsuspected, disclosed and
undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment
with the Company), arising out of or in any way related to
agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such
claims and demands directly or indirectly arising out of or in any
way connected with my employment with the Company or the termination
of that employment, including but not limited to, claims of
intentional and negligent infliction of emotional distress, any and
all tort claims for personal injury, claims or demands related to
salary, bonuses, commissions, stock, stock options, or any other
ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance pay, or any other form of disputed
compensation; claims pursuant to any federal, state or local law or
cause of action including, but not limited to, the federal Civil
Rights Act of 1964, as amended; the federal Age Discrimination in
Employment Act of 1967, as amended ("ADEA"); the federal Employee
Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; the California Fair
Employment and Housing Act, as amended; tort law; contract law;
statutory law; common law; wrongful discharge; discrimination;
fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that
nothing in this paragraph shall be construed in any way to release
the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or
applicable law.
<PAGE>
I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under ADEA. I also acknowledge that
the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything
of value to which I was already entitled. I further acknowledge
that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or
claims that may arise on or after the date I execute this Release;
(B) I have the right to consult with an attorney prior to executing
this Release; (C) I have forty-five (45) days to consider this
Release (although I may choose to voluntarily execute this Release
earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; (E) this Release shall
not be effective until the date upon which the revocation period has
expired, which shall be the eighth day after this Release is
executed by me; and (F) I have received with this Release a
detailed list of the job titles and ages of all employees who were
terminated in this group termination and the ages of all employees
of the Company in the same job classification or organizational unit
who were not terminated.
LUIZ BELARDINELLI
Date:
<PAGE>
EXECUTIVE
SEVERANCE BENEFITS AGREEMENT
This EXECUTIVE SEVERANCE BENEFITS AGREEMENT (the "AGREEMENT")
is entered into this 2nd day of February, 1999 (the "Effective
Date"), between STEPHEN J. GRANA ("EXECUTIVE") and CV Therapeutics,
Inc. (the "COMPANY"). This Agreement is intended to provide
Executive with the compensation and benefits described herein upon
the occurrence of specific events. Certain capitalized terms used
in this Agreement are defined in Article 5.
The Company and Executive hereby agree as follows:
ARTICLE 1
SCOPE OF AND CONSIDERATION FOR THIS AGREEMENT
1.1 Executive is currently employed by the Company.
1.2 The Company and Executive wish to set forth the
compensation and benefits which Executive shall be entitled to
receive in the event Executive's employment with the Company is
terminated under the circumstances described herein following a
Change in Control.
1.3 The duties and obligations of the Company to Executive
under this Agreement shall be in consideration for Executive's past
services to the Company, Executive's continued employment with the
Company, and Executive's execution of a release in accordance with
Section 3.1.
1.4 This Agreement shall supersede any other agreement
relating to cash severance benefits and health benefits in the event
of Executive's severance from employment with the Company following
a Change in Control.
ARTICLE 2
SEVERANCE BENEFITS
2.1 SEVERANCE BENEFITS. If Executive's employment terminates
due to an Involuntary Termination Without Cause or a Constructive
Termination within thirteen (13) months following the effective date
of a Change in Control, such termination of employment will be
deemed a Covered Termination. A Covered Termination entitles
Executive to receive the following benefits set forth in Sections
2.2, 2.3, 2.4, and 2.5.
2.2 SALARY CONTINUATION. Executive shall continue to receive
Base Salary for eighteen (18) months following a Covered
Termination. Such amount shall be paid in regular installments on
the normal payroll dates of the Company and shall be subject to all
required tax withholding.
<PAGE>
2.3 BONUS. The Company shall pay to Executive an amount
equal to one hundred and fifty percent (150%) of the annual bonus
paid to the Executive in the year immediately preceding the
effective date of the Change in Control. Such amount shall be paid
in regular installments on the normal payroll dates of the Company
and shall be subject to all required tax withholding.
2.4 HEALTH BENEFITS. Provided that Executive elects
continued coverage under federal COBRA law, the Company shall pay
the premiums of Executive's group health insurance coverage,
including coverage for Executive's eligible dependents, for a
maximum period of eighteen (18) months following a Covered
Termination; provided, however, that the Company shall pay premiums
for Executive's eligible dependents only for coverage for which
those eligible dependents were enrolled immediately prior to the
Covered Termination. No premium payments will be made following the
effective date of Executive's coverage by a health insurance plan of
a subsequent employer. For the balance of the period that Executive
is entitled to coverage under federal COBRA law, Executive shall be
entitled to maintain such coverage at Executive's own expense.
2.5 OPTION ACCELERATION. If Executive's employment with the
Company terminates due to a Covered Termination, then all options of
Executive to purchase the Company's common stock (or the stock of a
successor to the Company by reason of assumption or substitution of
options) shall become immediately fully vested and exercisable as of
the date of Executive's termination of employment.
2.6 MITIGATION. Except as otherwise specifically provided
herein, Executive shall not be required to mitigate damages or the
amount of any payment provided under this Agreement by seeking other
employment or otherwise, nor shall the amount of any payment
provided for under this Agreement be reduced by any compensation
earned by Executive as a result of employment by another employer or
by any retirement benefits received by Executive after the date of
the Covered Termination.
ARTICLE 3
LIMITATIONS AND CONDITIONS ON BENEFITS
3.1 RELEASE PRIOR TO PAYMENT OF BENEFITS. Upon the
occurrence of a Covered Termination, and prior to the payment of any
benefits under this Agreement on account of such Covered
Termination, Executive shall execute a release (the "Release") in
the form attached hereto and incorporated herein as Exhibit A or
Exhibit B, as applicable. Such Release shall specifically relate to
all of Executive's rights and claims in existence at the time of
such execution and shall confirm Executive's obligations under the
Company's standard form of proprietary information and inventions
agreement. It is understood that, as specified in the applicable
Release, Executive has a certain number of calendar days to consider
whether to execute such Release, and Executive may revoke such
Release within seven (7) calendar days after execution. In the
event Executive does not execute such Release within the applicable
period, or if Executive revokes such Release within the subsequent
seven (7) day period, no benefits shall be payable under this
Agreement, and this Agreement shall be null and void.
<PAGE>
3.2 TERMINATION OF BENEFITS. Benefits under this Agreement
shall terminate immediately if the Executive, at any time, violates
any proprietary information or confidentiality obligation to the
Company.
3.3 NON-DUPLICATION OF BENEFITS. Executive is not eligible
to receive benefits under this Agreement more than one time.
ARTICLE 4
PARACHUTE PAYMENTS
PARACHUTE PAYMENTS. If any payment or benefit Executive would
receive under this Plan, when combined with any other payment or
benefit Executive receives pursuant to the termination of
Executive's employment with the Company ("Payment"), would (i)
constitute a "parachute payment" within the meaning of Section 280G
of the Internal Revenue Code of 1986, as amended (the "Code"), and
(ii) but for this sentence, be subject to the excise tax imposed by
Section 4999 of the Code (the "Excise Tax"), then such Payment shall
be either (x) the full amount of such Payment or (y) such lesser
amount (with cash payments being reduced before stock option
compensation) as would result in no portion of the Payment being
subject to the Excise Tax, whichever of the foregoing amounts,
taking into account the applicable federal, state and local
employment taxes, income taxes, and the Excise Tax results in
Executive's receipt, on an after-tax basis, of the greater amount of
the Payment notwithstanding that all or some portion of the Payment
may be subject to the Excise Tax.
ARTICLE 5
DEFINITIONS
For purposes of the Agreement, the following terms are defined
as follows:
5.1 "BASE SALARY" means Executive's annual base salary as in
effect during the last regularly scheduled payroll period
immediately preceding the Covered Termination.
5.2 "BOARD" means the Board of Directors of the Company.
5.3 "CAUSE" means that, in the reasonable determination of
the Company or, in the case of the Chief Executive Officer, the
Board, Executive:
(A) has committed an act that materially injures the business
of the Company;
(B) has refused or failed to follow lawful and reasonable
directions of the Board or the appropriate individual to whom
Executive reports;
(C) has willfully or habitually neglected Executive's duties
for the Company; or
(D) has been convicted of a felony involving moral turpitude
that is likely to inflict or has inflicted material injury on the
business of the Company.
<PAGE>
Notwithstanding the foregoing, Cause shall not exist based on
conduct described in clause (b) or clause (c) unless the conduct
described in such clause has not been cured within fifteen (15) days
following Executive's receipt of written notice from the Company or
the Board, as the case may be, specifying the particulars of the
conduct constituting Cause.
5.4 "CHANGE IN CONTROL" means
(A) a sale of substantially all of the assets of the Company;
(B) a merger or consolidation in which the Company is not the
surviving corporation (other than a merger or consolidation in which
shareholders immediately before the merger or consolidation have,
immediately after the merger or consolidation, equal or greater
stock voting power);
(C) a reverse merger in which the Company is the surviving
corporation but the shares of the Company's common stock outstanding
immediately preceding the merger are converted by virtue of the
merger into other property, whether in the form of securities, cash
or otherwise (other than a reverse merger in which shareholders
immediately before the merger have, immediately after the merger,
greater stock voting power); or
(D) any transaction or series of related transactions in
which in excess of 50% of the Company's voting power is transferred.
5.5 "COMPANY" means CV Therapeutics, Inc. or, following a
Change in Control, the surviving entity resulting from such
transaction.
5.6 "CONSTRUCTIVE TERMINATION" means that Executive
voluntarily terminates employment within thirteen (13) months
following a Change in Control after any of the following are
undertaken without Executive's express written consent:
(A) the assignment to Executive of any duties or
responsibilities which results in a significant diminution in
Executive's function as in effect immediately prior to the effective
date of the Change in Control; provided, however, that a mere change
in Executive's title or reporting relationships shall not constitute
a Constructive Termination;
(B) a reduction by the Company in Executive's annual base
salary, as in effect on the effective date of the Change in Control
or as increased thereafter;
(C) any failure by the Company to continue in effect any
benefit plan or program, including fringe benefits, incentive plans
and plans with respect to the receipt of securities of the Company,
in which Executive is participating immediately prior to the
effective date of the Change in Control (hereinafter referred to as
"Benefit Plans"); or the taking of any action by the Company that
would adversely affect Executive's participation in or reduce
Executive's benefits under the Benefit Plans; provided, however,
that a "Constructive Termination" shall not exist under this
paragraph following a Change in Control if the Company offers a
range of benefit plans and programs which, taken as a whole, are
comparable to the Benefit Plans;
<PAGE>
(D) a relocation of Executive's business office to a location
more than twenty (20) miles from the location at which Executive
performs duties as of the effective date of the Change in Control,
except for required travel by Executive on the Company's business to
an extent substantially consistent with Executive's business travel
obligations prior to the Change in Control; provided, however, that
if Executive performs sales functions for the Company, a change of
sales territory shall not constitute a basis for Constructive
Termination so long as the Executive's business office is not
relocated as provided above;
(E) a material breach by the Company of any provision of this
Agreement; or
(F) any failure by the Company to obtain the assumption of
this Agreement by any successor or assign of the Company.
5.7 "COVERED TERMINATION" means an Involuntary Termination
Without Cause or a Constructive Termination occurring within
thirteen (13) months following the effective date of a Change in
Control.
5.8 "INVOLUNTARY TERMINATION WITHOUT CAUSE" means Executive's
dismissal or discharge other than for Cause. The termination of
Executive's employment as a result of Executive's death or
disability will not be deemed to be an Involuntary Termination
Without Cause.
ARTICLE 6
GENERAL PROVISIONS
6.1 EMPLOYMENT STATUS. This Agreement does not constitute a
contract of employment or impose upon Executive any obligation to
remain as an employee, or impose on the Company any obligation (i)
to retain Executive as an employee, (ii) to change the status of
Executive as an at-will employee, or (iii) to change the Company's
policies regarding termination of employment.
6.2 NOTICES. Any notices provided hereunder must be in
writing, and such notices or any other written communication shall
be deemed effective upon the earlier of personal delivery (including
personal delivery by facsimile) or the third day after mailing by
first class mail, to the Company at its primary office location and
to Executive at Executive's address as listed in the Company's
payroll records. Any payments made by the Company to Executive
under the terms of this Agreement shall be delivered to Executive
either in person or at the address as listed in the Company's
payroll records.
6.3 SEVERABILITY. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement
is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability will not affect any other provision
or any other jurisdiction, but this Agreement will be reformed,
construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provisions had never been contained herein.
<PAGE>
6.4 WAIVER. If either party should waive any breach of any
provisions of this Agreement, he or it shall not thereby be deemed
to have waived any preceding or succeeding breach of the same or any
other provision of this Agreement.
6.5 ARBITRATION. Unless otherwise prohibited by law or
specified below, all disputes, claims and causes of action, in law
or equity, arising from or relating to this Agreement or its
enforcement, performance, breach, or interpretation shall be
resolved solely and exclusively by final and binding arbitration
held in San Francisco County, California through Judicial
Arbitration & Mediation Services/Endispute ("JAMS") under the then
existing JAMS arbitration rules. However, nothing in this section
is intended to prevent either party from obtaining injunctive relief
in court to prevent irreparable harm pending the conclusion of any
such arbitration. Each party in any such arbitration shall be
responsible for its own attorneys' fees, costs and necessary
disbursement; provided, however, that in the event one party refuses
to arbitrate and the other party seeks to compel arbitration by
court order, if such other party prevails, it shall be entitled to
recover reasonable attorneys' fees, costs and necessary
disbursements. Pursuant to California Civil Code Section 1717, each
party warrants that it was represented by counsel in the negotiation
and execution of this Agreement, including the attorneys' fees
provision herein.
6.6 COMPLETE AGREEMENT. This Agreement, including Exhibit A
and Exhibit B, constitutes the entire agreement between Executive
and the Company and is the complete, final, and exclusive embodiment
of their agreement with regard to this subject matter, wholly
superseding all written and oral agreements with respect to cash
severance benefits and health benefits to Executive in the event of
employment termination other than any outstanding loans by the
Company to Executive. It is entered into without reliance on any
promise or representation other than those expressly contained herein.
6.7 AMENDMENT OR TERMINATION OF AGREEMENT. This Agreement
may be changed or terminated only upon the mutual written consent of
the Company and Executive. The written consent of the Company to a
change or termination of this Agreement must be signed by an
executive officer of the Company after such change or termination
has been approved by the Board.
6.8 COUNTERPARTS. This Agreement may be executed in separate
counterparts, any one of which need not contain signatures of more
than one party, but all of which taken together will constitute one
and the same Agreement.
6.9 HEADINGS. The headings of the Articles and Sections
hereof are inserted for convenience only and shall not be deemed to
constitute a part hereof nor to affect the meaning thereof.
6.10 SUCCESSORS AND ASSIGNS. This Agreement is intended to
bind and inure to the benefit of and be enforceable by Executive,
and the Company, and any surviving entity resulting from a Change in
Control and upon any other person who is a successor by merger,
acquisition, consolidation or otherwise to the business formerly
carried on by the Company, and their respective successors, assigns,
heirs, executors and administrators, without regard to whether or
not such person actively assumes any rights or duties hereunder;
<PAGE>
provided, however, that Executive may not assign any duties
hereunder and may not assign any rights hereunder without the
written consent of the Company, which consent shall not be withheld
unreasonably.
6.11 CHOICE OF LAW. All questions concerning the
construction, validity and interpretation of this Agreement will be
governed by the law of the State of California, without regard to
such state's conflict of laws rules.
6.12 NON-PUBLICATION. The parties mutually agree not to
disclose publicly the terms of this Agreement except to the extent
that disclosure is mandated by applicable law or to respective
advisors (e.g., attorneys, accountants).
6.13 CONSTRUCTION OF AGREEMENT. In the event of a conflict
between the text of the Agreement and any summary, description or
other information regarding the Agreement, the text of the Agreement
shall control.
IN WITNESS WHEREOF, the parties have executed this Agreement on
the Effective Date written above.
CV THERAPEUTICS, INC. STEPHEN J. GRANA
By: /s/ LOUIS G. LANGE, M.D., PH.D. /s/ STEPHEN J. GRANA
Name: Louis G. Lange, M.D., Ph.D.
Title: Chairman of the Board & Chief Executive Officer
Exhibit A: Release (Individual Termination)
Exhibit B: Release (Group Termination)
<PAGE>
EXHIBIT A
RELEASE
(INDIVIDUAL TERMINATION)
Certain capitalized terms used in this Release are defined in
the Executive Severance Benefits Agreement (the "Agreement") which I
have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.
I acknowledge that I have read and understand Section 1542 of
the California Civil Code which reads as follows: "A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT
WITH THE DEBTOR." I hereby expressly waive and relinquish all
rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any
claims I may have against the Company.
Except as otherwise set forth in this Release, I hereby
release, acquit and forever discharge the Company, its parents and
subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and
from any and all claims, liabilities, demands, causes of action,
costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise,
known and unknown, suspected and unsuspected, disclosed and
undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment
with the Company), arising out of or in any way related to
agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such
claims and demands directly or indirectly arising out of or in any
way connected with my employment with the Company or the termination
of that employment, including but not limited to, claims of
intentional and negligent infliction of emotional distress, any and
all tort claims for personal injury, claims or demands related to
salary, bonuses, commissions, stock, stock options, or any other
ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance pay, or any other form of disputed
compensation; claims pursuant to any federal, state or local law or
cause of action including, but not limited to, the federal Civil
Rights Act of 1964, as amended; the federal Age Discrimination in
Employment Act of 1967, as amended ("ADEA"); the federal Employee
Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; the California Fair
Employment and Housing Act, as amended; tort law; contract law;
statutory law; common law; wrongful discharge; discrimination;
fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that
nothing in this paragraph shall be construed in any way to release
the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or
applicable law.
<PAGE>
I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under ADEA. I also acknowledge that
the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything
of value to which I was already entitled. I further acknowledge
that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or
claims that may arise on or after the date I execute this Release;
(B) I have the right to consult with an attorney prior to executing
this Release; (C) I have twenty-one (21) days to consider this
Release (although I may choose to voluntarily execute this Release
earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; and (E) this Release
shall not be effective until the date upon which the revocation
period has expired, which shall be the eighth day after this Release
is executed by me.
STEPHEN J. GRANA
Date:
<PAGE>
EXHIBIT B
RELEASE
(GROUP TERMINATION)
Certain capitalized terms used in this Release are defined in
the Executive Severance Benefits Agreement (the "Agreement") which I
have executed and of which this Release is a part.
I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.
I acknowledge that I have read and understand Section 1542 of
the California Civil Code which reads as follows: "A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT
WITH THE DEBTOR." I hereby expressly waive and relinquish all
rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any
claims I may have against the Company.
Except as otherwise set forth in this Release, I hereby
release, acquit and forever discharge the Company, its parents and
subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and
from any and all claims, liabilities, demands, causes of action,
costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise,
known and unknown, suspected and unsuspected, disclosed and
undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment
with the Company), arising out of or in any way related to
agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such
claims and demands directly or indirectly arising out of or in any
way connected with my employment with the Company or the termination
of that employment, including but not limited to, claims of
intentional and negligent infliction of emotional distress, any and
all tort claims for personal injury, claims or demands related to
salary, bonuses, commissions, stock, stock options, or any other
ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance pay, or any other form of disputed
compensation; claims pursuant to any federal, state or local law or
cause of action including, but not limited to, the federal Civil
Rights Act of 1964, as amended; the federal Age Discrimination in
Employment Act of 1967, as amended ("ADEA"); the federal Employee
Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; the California Fair
Employment and Housing Act, as amended; tort law; contract law;
statutory law; common law; wrongful discharge; discrimination;
fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that
nothing in this paragraph shall be construed in any way to release
the Company from its obligation to indemnify me pursuant to the
Company's indemnification obligation pursuant to agreement or
applicable law.
<PAGE>
I acknowledge that I am knowingly and voluntarily waiving and
releasing any rights I may have under ADEA. I also acknowledge that
the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything
of value to which I was already entitled. I further acknowledge
that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or
claims that may arise on or after the date I execute this Release;
(B) I have the right to consult with an attorney prior to executing
this Release; (C) I have forty-five (45) days to consider this
Release (although I may choose to voluntarily execute this Release
earlier); (D) I have seven (7) days following the execution of this
Release by the parties to revoke the Release; (E) this Release shall
not be effective until the date upon which the revocation period has
expired, which shall be the eighth day after this Release is
executed by me; and (F) I have received with this Release a
detailed list of the job titles and ages of all employees who were
terminated in this group termination and the ages of all employees
of the Company in the same job classification or organizational unit
who were not terminated.
STEPHEN J. GRANA
Date:
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains financial information extracted from the Consolidated
Balance Sheet as of March 31, 1999 and the Consolidated Statement of
Operations for the three month period ended March 31, 1999 and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 7,068
<SECURITIES> 32,358
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 40,474
<PP&E> 7,725
<DEPRECIATION> (4,958)
<TOTAL-ASSETS> 43,835
<CURRENT-LIABILITIES> 4,693
<BONDS> 0
0
0
<COMMON> 104,316
<OTHER-SE> (74,359)
<TOTAL-LIABILITY-AND-EQUITY> 43,835
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 5,383
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 235
<INCOME-PRETAX> (5,053)
<INCOME-TAX> 0
<INCOME-CONTINUING> (5,053)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (5,053)
<EPS-PRIMARY> (0.45)
<EPS-DILUTED> (0.45)
</TABLE>
